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TMI Blog2014 (8) TMI 97X X X X Extracts X X X X X X X X Extracts X X X X ..... he agreement with M/s. Sabarmati River Front Development Corporation Limited. The Revenue's case is that the appellant have provided "Site Formation and Clearance, Excavation and Earthmoving and Demolition Services" and hence they are liable to pay the service tax. In the impugned orders the cases have been adjudicated and the demands have been confirmed penalties have also been imposed on the appellants. Appellant's contention is that the said service is not a taxable service and hence no service tax is payable. 3. Heard both sides. 4. The main contention of the Ld. Advocate for the appellant is that the activity carried out by the appellant is of construction of diaphragm wall with reinforced anchor slab and special fill for Guide Bund and retention wall as can be seen from the Bid document dated 25.11.2005, as copy of bid submitted by Appellant ITD Cementation dated 17.12.2005, and acceptance of the bid vide letter dt. 14.1.2006. Thus all the above documents contemplate the activity of construction of diaphragm wall with reinforced anchor slab and after the offer and acceptance the ultimate contract of construction of diaphragm wall has been executed on 1.3.2006. The o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cond contention of the Ld. Advocate is that assuming without admitting that the activity carried out by the appellant is classifiable under 'site formation and clearance, excavation and earth moving and demolition services' then also the said activity is under the excluded portion of the definition viz. "but does not include services provided in relation to agriculture, irrigation, watershed development and drilling, digging, repairing, renovating or restoring of water sources and water bodies". The object of construction of diaphragm wall, anchor slab and retention wall is for renovating the water source as stated in the agreements. 7. The third contention of the learned Advocate was that the original authority has failed to appreciate the issue of valuation. It was their contention that the gross value includes the material cost which should be deducted from the total cost in view of modification No. 12/2003. In support of the said contention Learned Advocate quoted the following case laws: [a] Era Infra Engineering Ltd. Vs. Union of India 2008 (11) STR 3 (Del.) [b] LSG Sky Chefs (India) Pvt. Ltd. Vs. CST, Bangalore 2008 (12) STR 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... new assets/facilities and, therefore, it cannot be said that appellants are covered by the exclusion clause. As far as valuation of the service is concerned, Ld. A.R. argued that as per Notification No. 12/2003 appellants have to sell the material and they have not produced any evidence to support their contention and in view of the said position benefit of Notification No. 12/2003 cannot be extended. On the contention that prior to 1.6.2007 tax cannot be levied as the nature of activity is works contract, Learned A.R submitted that matter is already settled by number of decisions of this Tribunal as also by Hon'ble Delhi High Court in the case of G.D. Builders Vs. Union of India reported in 2013 (32) STR 673 (Del). 10. We have considered the rival submissions. We have also gone through the project report as also various contention raised by the appellants and revenue. As per Section 65 (97a) of the Finance Act, 1944, the said service is defined as under: "(97a) "site formation and clearance, excavation and earthmoving and demolition" includes, - (i) Drilling, boring and core extraction services for construction, geophysical, geological ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tipping without compaction, Special fill will have angle of internal friction of about 30 0 and maximum particle size not exceeding 75mm. Embankment construction above water level will be done with the above mentioned material but with compaction at OMC 95% relative compaction. 3. Diaphragm Wall- a. A RCC Guide Wall of 1.20 metre depth and 100mm thickness with nominal reinforcement will be constructed from the working level. The top of guide work shall be above existing ground level. b. Construction of diaphragm wall panels of maximum width of 5.4 to 6.0 metres will be constructed. Trenching shall be carried out upto stipulated depth by using rope operated grab handled by suitable crane using bentonite of suitable consistency. The width of the trench excavated shall be 60 cms. c. Chiselling shall be carried out by using heavy chisels and chiseled material will be removed by using trenching grabs. The process of chiseling continues till it reaches the founding level. d. On reaching the fou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of expenditure in connection with the reclamation of the land (excluding the facilities like commercial complex, residential complex, roads etc. to be construed later on the reclaim land.) We have therefore no hesitation in holding that the activity undertaken by the appellants are site formation and clearance, excavation and earth moving and demolition service. 11. The Ld. Advocate without specifying in so many word, has attempted to indicate that the services rendered by the appellants are covered by commercial or industrial construction service, perhaps due to the fact that they are undertaking civil work. We have carefully considered this submission, we have also gone through the maps and activities. It may be true that the activity undertaken by the appellant involved some civil work but the nature of the said civil work is for reclaiming the land from the river. A part of the wall is below the river bed level, a part of it is above. Angle slabs are used for supporting and after filling the top of the land is used for various purpose. Retention wall is again to support. We also note that the area is filled with sand etc. thus over all the work is of a nature which would squa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the activities are to be classified under the correct classification of services as per the terms of agreement and in support of the same quoted number of case laws. There cannot be two opinions that the activities are to be classified under the correct classification of service. However, as mentioned earlier, in our view the correct classification of the activities in the present case is "site formation and clearance, excavation and earth moving and demolition service". 12. The second contention of the Ld. Advocate is that their activities will get excluded under the exclusion clause of the "site formation and clearance, excavation and earth moving and demolition service". The said exclusion clause excludes services provided in relation to agriculture, irrigation, watershed development and drilling, digging repairing, renovating or restoring of water sources and water bodies. The activities are being undertaken on Sabarmati River and the river is a water body. We find strength in the argument of the appellant that their activities are in the nature of renovating or restoring of water sources and water bodies. Even though, the river front that is being developed is new projec ..... X X X X Extracts X X X X X X X X Extracts X X X X
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