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TMI Blog2015 (1) TMI 231X X X X Extracts X X X X X X X X Extracts X X X X ..... lso in our opinion are required to be gone into in greater detail than what has been done. From the contract it becomes quite clear that the equipment suppliers did not undertake or were required to take erection, commissioning and installation of the equipments supplied by them. Prima facie from the Contract it appears that the erection, commissioning and installation work is not to be undertaken by the foreign suppliers. The very fact that appellants have made 90% of the payment due to the foreign suppliers would also support the case of the appellant that there is no component of erection, commissioning or installation service in the payment since the erection, commissioning and installation has not at all started leave alone getting com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CON (Consultant), for and on behalf of M/s TTPL, entered into an agreement dated 10.02.2006, with M/s Chematur Ecoplanning Oy, Pohjoisranta 11F, Pori, Finland (principal contractor and hereinafter referred to as CEO) together with AVI Europe Ltd., Dartford, Kent DA14WW, United Kingdom (Associate and hereinafter referred to as AVI), for providing Basic Engineering, Design, Manufacture, and Supply of critical/proprietary equipment, expert supervision of erection and commissioning for Copperas Recovery Plant and Acid Recovery Plant (hereinafter referred to as CRP and ARP respectively) and also undertake to erect and commission the plant at TTPL. As per clause 1.1 of Schedule-1 of the second agreement, the scope of wok shall cover Provid ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he operation maintenance of the plant. viii. Commissioning and establishing the process guarantee parameters after stabilization of the plant operation. ix. Information on commissioning and normal operation spares of all the equipment/facilities of copperas Recovery plant and Acid recovery plant. 3. Demand for service tax of ₹ 2,54,74,592/- with interest has been confirmed against the appellant and penalties have been imposed on the ground that the agreements entered into with the foreign suppliers for equipment includes service portion also and therefore the contract has to be treated as one of a contract entered into between the parties for execution of works contract for the appellants. It has been held that the service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t such payments have been made. Further he also draws our attention to the observations in paragraph 28 and 29 and submits that these observations are totally wrong. In fact he submits that appellants have paid 90% of the amount required to be paid by them and they have declared the entire value of the contract for the purpose of inclusion of customs duty in the Bill of Entry. With the help of documents produced by him he shows this to be a fact. 5. Learned AR on the other hand would submit that the Commissioners observations are categorical and very clear in paragraph 28 29. Apparently the evidences which have been produced before us today to show that the entire value has been declared in the Bill of Entry was not made before the Co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CRP/01/05-06 dt. 17.06.2006 680000 12,16,69,652 1,50,38,369 5 CRP/02/05-06 dt. 17.06.2006 680000 6 CRP/03/05-06 dt. 17.06.2006 680000 Total 2,78,47,003 29. Clearly these invoices have not been subjected to any Customs duty and they pertain to service element in the contract. The amount paid by the assessee is to be treated as payment made for services to be received by them. However, since the amount proposed in the show-cause notice is lesser than this a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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