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TMI Blog2015 (8) TMI 639X X X X Extracts X X X X X X X X Extracts X X X X ..... he activities of 'works contract' undertaken by the appellant is therefore classifiable under 'works contract service' w.e.f. 01/6/2007. The same service even if provided under a works contract before 01/6/2007, will be classifiable under Erection, Commissioning or Installation Service (ECIS). Free supplies made by service recipient to the service provider for providing construction service are not includable in gross amount charged as per Section 67 of the Finance Act, 1994. It is observed from case records that appellants are using materials like cement, sand, bricks etc. in providing 'Erection, Commissioning or Installation Service, therefore, benefit of 67% abatement under Notification No. 1/2006-ST dated 01/3/2006 will be admissible ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... /2009, ST/660/2009 and ST/661/2009 have been filed by the Revenue against the same OIA dated 11/05/2006. Cross Objection ST/11/2010 has been filed by M/s Saraswati Traders with respect to appeal No. ST/661/2009 filed by the Revenue. 2. Shri Kapil Vaish (C.A.), appearing on behalf of the appellant M/s P.C. Construction and M/s Raj Co., learned C.A. argued that his clients are providing services of Erection, Commissioning or Installation Service (ECIS) to M/s Bharat Sanchar Nigam Limited (BSNL) in the form of erection of towers for which certain items are supplied free of charge by BSNL and certain other items are used by the appellants. That Commissioner (Appeals) allowed them the benefit of 67% abatement as per Notification No. 19/2003 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid by appellants would have been available as Cenvat credit and intention to evade payment cannot be attributed to the appellants. It was thus his case that extended period and penalty under Section 78 of the Finance Act, 1994 cannot be invoked. That due to interpretational dispute and harbouring a bonafide opinion that appellant activity is not taxable, there was a reasonable cause for which benefit of Section 80 of the Finance Act, 1994 will be available. He relies upon the case law of Jai Jawan Coal Carriers Pvt. Ltd. vs. CST, New Delhi reported in 2015 (37) S.T.R. 509 (Tri. - Del.). It was also argued by the learned CA that benefit of cum-tax payment has not been made available as per Section 67 (2) of the Finance Act, 1994. 3. Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the 'cross objection'. Adjournment request of the respondent in appeal No. ST/661/2009 is rejected and their matter is also taken up for disposed alongwith other appeals. 4. Heard both sides and perused the case records. 5. Main issue involved in all these appeals is as to what should be the classification of the activities undertaken by the appellants, whether the same should be considered Erection, Commissioning or Installation Service (ECIS) or as works contract service. Period of dispute in all these appeals is 1/5/2006 to 17/3/2008. Works contract service came into existence w.e.f. 01/6/2007 and was carved out of earlier services of Commercial or Industrial Construction Service (CICS), Construction of Complex Service (CO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ax on 'works contract' activities was payable as the Sale/Trade Tax authorities has taken his client's activities as works contract. Looking to the factual matrix of the present proceedings it is observed that there could be a bonafide belief on the part of the appellant that their activities do not attract service tax before 01/6/2007. Service tax if any paid by the appellant under ECIS could have been admissible as Cenvat credit to BSNL. It is also not the case of the Revenue that service tax payable was collected by the appellants from BSNL and not paid to the Department. Accordingly, it is held that extended period is not invokable in these appeals. However, the demand on ECIS with respect to normal period of limitation is s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e belief that no service tax was payable by them before 01/6/2007, as 'works contract service', there is a reasonable cause for non-payment of tax and benefit of Section 80 of the Finance Act, 1994 is admissible. Accordingly, it is held that no penalites under Section 76, 77 and 78 are imposable upon the appellants in these proceedings. 6. So far as demand of service tax after 01/6/2007 is concerned, it was argued by the appellants that no show cause notice was issued to them for demanding duty under 'Works Contract Service' and on perusal of records we find it so. In the absence of any demands under 'Works Contract Service' for the period after 01/6/2007, appeals filed by the appellants to that extent are require ..... X X X X Extracts X X X X X X X X Extracts X X X X
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