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TMI Blog2016 (5) TMI 455X X X X Extracts X X X X X X X X Extracts X X X X ..... ocess is nothing but commissioning i.e. bringing Rolling stocks into operation. Therefore, we agree with the applicant that the services provided i.e. in relation to testing & commissioning, integrated testing and commissioning, trial runs of trains, are by way of commissioning. Works Contract - original work - Held that:- “original work” inter-alia means erection, commissioning or installation of plant, machinery or equipment or structures, whether fabricated or otherwise. - Rolling stock is at least plant and machinery and same would be commissioned by the applicant. Therefore, the applicant would satisfy this condition also i.e. providing services by way of commissioning of original work. Applicant is eligible for claiming exemption from payment of Service Tax in terms of Notification No. 25/2012-ST dated 20.06.2012 for the activities in relation to Testing & Commissioning, Integrated Testing & Commissioning and Trial runs of Trains to be undertaken under the contract. - Decided in favor of assessee. - Ruling No. AAR/ST/12-13/2016, Application No. AAR/44/ST/18/2013 & AAR/44/ST/32/2013 - - - Dated:- 22-4-2016 - V. S. Sirpurkar (Chairman) , Shri S. S. Rana (Member) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pplications are taken up together, for common ruling. In the present application, the applicant has raised only one question which is common in both the applications and is as follows: Whether the applicant is eligible for claiming exemption from payment of Service Tax in terms of Notification No. 25/2012 dated 20.06.2012 for the activities in relation to Testing Commissioning, Integrated Testing Commissioning and Trial runs of Trains to be undertaken under the Contract? 3. Applicant inter-alia submits that as per two Contracts, they are required to undertake testing to ensure integration of the Rolling Stock to the metro systems and said activity clearly amounts of commissioning of the rolling stock on to the metro rail system; that each metro rail system has its own requirements with respect to the various stations, signaling, gauge measurement etc. and therefore, the seamless integration by the applicant is required to undertaken by conducting testing, integrated testing and trial runs before the final commissioning of the Rolling Stock; that both the contracts are in relation to original works of setting up of metro rail at Delhi and Hyderabad; that conceptually, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed upon the decisions of the Hon ble Supreme Court in CIT vs. Mir Mohammad Ali (1996)7SCR 846 and C.I.T. vs. Taj Mahal Hotel (1971) 3 SCC 550 to state that the Rolling Stocks, which are installed by the applicant will fall within the definition of plant , machinery as well as equipment and therefore, will be covered by said exemption Notification. 4. Revenue submits that the services related to installation and commissioning of Rolling Stock will be exempt from Service Tax, if these are for original works pertaining to Railways, including Monorail and Metro. 5. Relevant portion of S. No. 14 of Notification No. 25/2012-ST dated 20.06.2012 exempting taxable services from whole of the Service Tax leviable thereon under Section 66B of the Finance Act, 1994 is as under; 14 Services by way of construction, erection, commissioning or installation of original works pertaining to:- (a) an airport, port or railways, including monorail or metro X X X X X 6. Para 2(y) of Notification No. 25/2012-ST dated 20.06.2012 is reproduced as under; 2. Definitions For the purpose of this notification, unless the context otherwise requires,- (y) original works ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ory completion of Contractor s tests on his equipment, sub-systems or system to verify and confirm the compatibility and compliant performance of his equipment/subsystem/ system with the equipment/sub-system/system provided by others. 1.1.6.12 Works means the work, both permanent and temporary, or services to be carried out, designed, manufactured, fabricated, delivered to Site, erected, installed, completed, tested, commissioned,(including Integrated Testing and Commissioning) and remedying of any defects, and/ or supplied in accordance with the Contract and include Plant, Rolling Stock and Materials and their accessories. 10. Clause 4 of Contract Agreement dated 05.09.2012 between L T Metro Rail (Hyderabad) Limited and the applicant (Contractor) mentions 3 documents, which shall be deemed to comprise the Contract. One such document is Conditions of Contract. Relevant portions of Conditions of Contract of L T Metro Rail (Hyderabad) Limited (Tender Package D 0101: Rolling Stock) are as under; 8. CONTRACTOR S OBLIGATIONS 8.1. Objective and Nature of Contract 8.2 General Responsibilities 8.2.1.12 Perform all necessary testing and commissioning of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation No. 25/2012-ST dated 20.06.2012, original works is the meaning, assigned to it in Rule 2A of the Service Tax (Determination of Value) Rules 2006, wherein original work inter-alia means erection, commissioning or installation of plant, machinery or equipment or structures, whether fabricated or otherwise. We have already held in preceding paragraph that Rolling stock is at least plant and machinery and same would be commissioned by the applicant. Therefore, the applicant would satisfy this condition also i.e. providing services by way of commissioning of original work. 14. Third condition relates to providing said services pertaining to railways, including monorail or metro. This condition has not been opposed by the Revenue, as it is evident that the services relate to Delhi Metro Rail Corporation and L T Metro Rail Hyderabad Limited. 15. In view of above, we rule as under; Applicant is eligible for claiming exemption from payment of Service Tax in terms of Notification No. 25/2012-ST dated 20.06.2012 for the activities in relation to Testing Commissioning, Integrated Testing Commissioning and Trial runs of Trains to be undertaken under the contract. - ..... X X X X Extracts X X X X X X X X Extracts X X X X
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