9911796707
TMI Blog2018 (4) TMI 844X X X X Extracts X X X X X X X X Extracts X X X X ..... 2016 dated 23/09/2016. The appellant is engaged in the Construction of Residential and Commercial C omplexes as well as development of Residential and Industrial Townships. The appellant developed two townships in Jaipur namely "Manglam Aangan Villas" and "Manglam Arpan Villas" consisting of individual villas duly approved by the Jaipur Development Authority in terms of Rajasthan Township Policy, 2010. The DGCEI investigated an intelligence against the appellant indicating that they have not discharged their Service Tax liability properly. The intelligence further revealed that they were not paying Service Tax on the two villa s projects at Jaipur. After conclusion of investigation and issue of show cause notice dated 12/10/2015 the impugned order was passed in which demand for Service Tax was upheld on various grounds. The issues involved in the present case along with the amounts of Service Tax demanded are summarized below for ready reference: - S. No. Issue Period Service Tax/Credit (Rs.) 1. Non-payment of Service Tax on construction of individual villas in two projects, namely "Manglam Aangan Villas" and "Manglam Arpan Villas" April, 2011 to March, 2015 3,03,81 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been included in the list of declared services under Section 66 E (b) of the Finance Act, 1994. Since there is no machinery provision in the Act or Rules even for the period from 01/07/2012, the decision of the Hon'ble Court in Suresh Kumar Bansal (supra) will continue to be applicable and levy of Service Tax on composite contracts cannot be sustained even for the period subsequent to 01/07/2012. iii. The activities carried out by the appellant involved supply of goods as well as services. Such contracts are classifiable, not under CCS, but under the category of "Works Contract Services" (WCS) falling under the scope of Section 65 (105) (zzzza). The Hon'ble Supreme Court in the case of L & T 2015 (39) STR 913 (SC) has held that in the case of composite contracts no Service tax can be charged prior to introduction of WCS W.E.F. 01.07/2012. Hence no Service tax demand can be confirmed up to 30/06/2012. iv. The demand cannot be confirmed even for the period from 01/07/2012 in terms of Section 66 E (b) since the show cause notice has raised the demand under CCS and the service is not classifiable therein, as per the ratio of the decision of Hon'ble Tribunal in the case of URC Cons ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the category of "Construction S ervices" after claiming abatement. viii. The appellant is also not liable to pay Services Tax on club charges under the category of "Club or Association Services". In this connection he relied on the following cases: - * Sports Club of Gujarat Ltd. v Union of India, 2013 (31) STR 645 (Guj) * Ranchi Club Ltd v. Chief Commissioner, 2012 (26) STR 401 (Jhar) ix. The appellant is also not liable to pay Service Tax on Works Contract Services received by them under reverse charge mechanism. He submitted that the said services were used for construction of roads within the townships. The roads are in the nature of public roads and hence no Service Tax is liable. 4. The Ld. DR justified the impugned order. His submission sare summarized below: - i. The ratio laid down by the Hon'ble High Court of Delhi in the case of Suresh Kumar Bansal (supra) is not applicable to the present case. He submitted that retrospective amendment has been carried out in Rule 2A of Service Tax (determination of Value Rules, 2006) vide Section 129 of the Finance Act, 2017. This amendment has provided for machinery provision to arrive at the value of service in composite co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon'ble High Court has observed as below: - "49. Whilst the impugned explanation expands the scope of Section 65(105) (zzzh) of the Act, it does not provide any machinery for excluding the non - service components from the taxable services covered therein. The Rules also do not contain any provisions relating to determination of the value of services involved in the service covered under Section 65(105) (zzzh) of the Act. Thus the said clause cannot cover composite contracts such as the one entered into by the petitioners with the builder. 55. However, we accept the petitioners contention that no service tax under Section 66 of the Act read with Section 65(105) (zzzh) of the Act could be charged in respect of composite contracts such as the ones entered into by the petitioners with the builder. The impugned explanation to the extent that it seeks to include composite contracts for purchase of units in a complex within the scope of taxable service is set aside." 7. The appellant has submitted that in view of the decision of the Hon'ble Delhi High Court (Supra) , no Service Tax can be charged under CCS for the period up to 30/06/2012. Further it has been argued that even W.E.F ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
