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TMI Blog2016 (10) TMI 620X X X X Extracts X X X X X X X X Extracts X X X X ..... ommissioner of Central Excise, Kerala, vs. L & T Ltd. [2015 (8) TMI 749 - SUPREME COURT] relied upon where it was held that such contracts should be classified only under works contract scheme w.e.f. 01/6/07. Further questions which arise are (i) whether the appellant will be entitled to the benefit of composite scheme and (ii) whether they will be entitled to exclude the value of goods supplied under Rule 2A of the Service Tax Determination of Valuation Rules - this issue stands decided in the case of Ahluwalia Contracts (I) Ltd. vs CCE, Noida [2015 (7) TMI 855 - CESTAT NEW DELHI] where it is held that the issue is not res integra and this case relied upon. They will be entitled to re-classify their services under Works Contract Scheme 01/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orks contract service w.e.f. 01/6/07 for the reason that the service tax payment had already commenced prior to 01/6/07 under CIS and the same works contracts were continued beyond that date. Further, the availment of the composition scheme was also held to be improper in the light of the Rule 3 (3) of the Works Contract (composition scheme for payment of service tax) Rules, 2007 which provides that :- The provider of taxable service who opts to pay service tax under these rules shall exercise such option in respect of a works contract prior to payment of service tax in respect of the said works contract and the option so exercised shall be applicable for the ent ire works contract and shall not be withdrawn until the completion of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itled to the change of their classification to WCS, but will also be entitled to the benefit of Rule 2A of the Service Tax Determination of Valuation Rules, 2006. This view finds support in the decision of Tribunal in the case of Ahluwalia Contracts (I) Ltd, vs, CCE, Noida reported in 2015 (38) 33 (Tri. Del.). This decision also stands affirmed by the Hon'ble High Court of Allahabad reported in 2016 (41) S.T.R. 3261 (AIL). They, however, admitted that they will not be entitled to the benefit of the composition scheme w.e.f. 01/6/07 in view of Rule 3 (3) of the Composition Scheme. 4. We have heard Shri Narendra Singhvi, Advocate, the learned Counsel for the appellant as well as Shri Amresh Jain, learned DR for the Revenue. 5. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch re-classification on the ground that services under those works contracts had commenced prior to 1-6-2007 under CICS/CCS and as per Board's Circular No. 98/1/2008-S.T., dated 4-1-2008 Composition Scheme in respect of such contracts is not permissible. The issue whether for ongoing contracts which commenced prior to 16-2007 and Service Tax was paid under respective services, Composition Scheme could be availed of with effect from 1-6-2007 classifying the service under works contract service has been decided by Andhra Pradesh High Court in the case of Nagarujuna Construction Ltd. holding that for such ongoing contracts, the assessee cannot switch over to Composition Scheme. However, there can be no doubt that the classification of serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A of the Service Tax Determination of Valuation Rules. However, we find that the issue needs to be remanded back to the original Adjudicating Authority for evaluating the claim of the appellant to the quantum of the benefit entitled to them under Valuation Rule 2A of the Service Tax Determination of Valuation Rules. For this purpose, we remand the matter to the Adjudicating Authority. The appellant is directed to produce all necessary documentation supporting their claim for the benefit under Rule 2A. The Adjudicating Authority is directed to consider such claims and decide the matter afresh after giving an effective opportunity to the appellant put forth his claim. 7. The appeal is allowed by way of remand. (Order dictated and pronou ..... X X X X Extracts X X X X X X X X Extracts X X X X
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