9911796707
TMI Blog2015 (2) TMI 350X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 65 A of the Finance Act 1994. To that extent the Board's Circular is devoid of correct appreciation of the legal provisions. It is claimed in the orders of the lower authorities that the said Board Circular has been upheld by the judgment of Andhra Pradesh High Court in the case of Nagarjuna Construction Company vs. Govt. of India - [2010 (6) TMI 91 - ANDHRA PRADESH HIGH COURT ]. We have perused the said judgment of Andhra Pradesh High Court and find that nowhere the High Court has said that the classification of ongoing services cannot be changed to works contract service, if the service was more appropriately classified there-under; what the High Court has, however, upheld is the Board s clarification that in respect of the on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der in original No.10/SG Div-II/12 dated 28.12.2012 (in terms of which service tax demand of ₹ 5,62,410/- for the period 01.04.2007 to 31.03.2008 alongwith interest and penalties under sections 77 and 78 ibid were confirmed). 2. The facts briefly stated are as under:- The appellants have been providing various construction services in an on-going project and paidservice tax prior to 01.06.2007 under commercial or industrial construction services, but from 01.06.2007 changed the classification under works contract service. For the period prior to 01.06.2007 they paid service tax on 33% of the gross amount and after 01.06.2007 they availed of the Works Contract (Composition Scheme for payment of service tax) Rules, 2007. The lower ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ants were not entitled to change the classification for the purpose of payment of service tax on or after 01.06.2007 and they were not entitled to avail of the Composition Scheme. 6. In this regard, it needs to be appreciated that the services were being rendered under ongoing projects on a continuous basis. It was not that the entire service was rendered on the date of entering into the contract. Thus, the classification of the services has to be done in accordance with the provisions of section 65 (105) ibid and with the introduction of the new service w.e.f. 01.06.2007, if the service got more appropriately covered under the scope of works contract service, it will have to be classified there-under in terms of Section 65 A of the Fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nal adjudicating authority with the direction that (i) the appellants should be allowed to classify their services as works contract service even in respect of ongoing projects w.e.f. 01.06.2007, provided that the services are more specifically covered there-under and not to deny such classification only on the ground that prior to 01.06.2007 in respect of some ongoing contracts the classification was elsewhere and (ii) thereafter for the relevant periods (i.e. prior to 01.06.2007 and w.e.f. 01.06.2007) the appellants should be allowed to make a claim for the benefit of any applicable notification (including Notification No.12/2003-ST) or the Provisions of Rule 2A of the Service Tax (Determination of Value) Rules, 2006 and produce the neces ..... X X X X Extracts X X X X X X X X Extracts X X X X
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