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TMI Blog2017 (4) TMI 704X X X X Extracts X X X X X X X X Extracts X X X X ..... ant by the Larger Bench decision in the case of Bhayana Builders P. Ltd. [2013 (9) TMI 294 - CESTAT NEW DELHI (LB)], where it was held that free supplies made by the service receiver shall not be added to the value of the services - the demand of service tax of 44,66,679/- confirmed on the free supplies, which includes the value of electricity and other items is not sustainable and is hereby dropped. Appeal allowed - decided in favor of appellant. X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant says that impugned order failed to examine the limited scope of definition of site formation service and when several activities are undertaken, ultimately leading to mining then the gamut of activities cannot be taxed under site formation service. In support of their case, the appellant relies on the following case laws:- 1. Sadbhav Engineering Ltd. vs. C.S.T., Ahmedabad - 2016 (43) STR 288 (Tri.-Ahmde.) 2. Associated Soapstone Distributing Co. P. Ltd. vs. C.C.E., Jaipur-II - 2014 (34) STR 865 (Tri. - Del.) 3. CCE, Hyderabad vs. Vijay Leasing Company -2011 (22) STR 553 (Tri.-Bang.) 6. In case of service tax demand on the free supplies, the ld. Advocate for the appellant interalia submits that free supplies made by the servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecision (F.O. No. 52560/2016 dated 26.07.2016 in Service Tax Appeal No. 309/2009 observed as under:- "4. Heard both the sides and examined the appeal records. On the first issue regarding appellant's service tax liability prior to 01/6/07 under the category of site preparation we find on careful consideration of the terms of agreement with Hindustan Zinc Limited that these services are primarily w.r.t. mining of ore. The agreements are composite involving various connected work with main objective being raising of ore. Similar issue has been subject matter of decision earlier by the Tribunal in Arvind Kumar & Co. vs. CCE, Jaipur - II vide final order No. ST/737-738/2012 - CU (DB) dated 30/11/2012, in Associated Soapstone Distributing Co. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of taxable services for determination of the liability to tax under Section 67 of the Act in view of sub-clause (ii) of Section 67(1), we are not persuaded that this is the appropriate construction of the provision. Sub-clause (ii) applies where a taxable service is provided for a consideration which is not either wholly or partly, for money. Therefore the non-monetary consideration must still be a consideration accruing to the benefit of the service provider, from the service recipient and for the service provided. (iv) ………. (v) Clearly, Section 67 of the Act deals with valuation of taxable services and intends to define what constitutes the value received by the service provider as "consideration" from the serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ices provided. Whether the legislature may enact that the value of "free supplies" should be included in the value of the service provided for levy of tax; and within its legislative competence, is an aspect that is speculative for the nonce and outside the purview of either the substantive appeals or the issue referred to us. In this view of the matter it is not necessary to consider the contention on behalf of the assessees that an interpretation that Section 67 of the Act enables or mandates inclusion of the value of goods and materials incorporated into construction services (whether provided by the service provider or as a free supplies by the service recipient) would render the legislative provision unconstitutional, since value of th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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