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TMI Blog2018 (11) TMI 1083X X X X Extracts X X X X X X X X Extracts X X X X ..... In the course of audit of accounts, it was noticed by the department that appellants have not paid service tax for the following services from 1.4.2008 that is engineering, procurement, erection and commissioning of sewage treatment plant and implementing of water supply projects to various municipal corporations. On inquiry, the appellants replied to the department that the said activities are basically civil activity of non-commercial nature and therefore no service tax was payable. The department was of the view that the said service was classifiable as EPC projects as defined under sub-section (ii)(e) of Section 65(105)(zzzza) of Finance Act, 1994 which defines works contract service. It was also the view of the department that supply, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - 2015 (38) STR 709 has categorically held that such activities which are excluded as turnkey / EPC contracts would be classified under clause (b) Explanation (ii) of Section 65(105)(zzzza). Similar view was taken by the Tribunal in the case of Ramky Infrastructure Ltd. - 2018 (12) GSTL 32. It is also pointed out by the ld. counsel that the appellant had filed refund application dated 23.10.2008 for refund of Rs. 48,29,661/- and the Commissioner (Appeals) vide Order-in-Appeal No. 301/2016 dated 25.5.2016 has allowed the refund claim except for an amount of Rs. 7,89,267/-. In the said order, the Commissioner (Appeals) has followed the decision in the case of Lanco Infratech Ltd. as well as Indian Hume Pipes Ltd. reported in 2015 (140) STR 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt plant, water treatment plant etc. Such water treatment plant and sewage treatment plant would not come within the ambit of laying pipeline or conduit and therefore the demand raised is legal and proper. Further, the said projects were undertaken under turnkey projects and sub-clause (e) of the explanation clarifies that turnkey projects include engineering, procurement and construction or commissioning would be taxable service. 4. Heard both sides. 5. The main issue in the present appeals to be decided is whether the construction of water treatment plant, sewage treatment plant constructed by the appellant is subject to levy of service tax under works contract service. The appellants have argued that they would be exigible to service t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kings for augmentation of irrigation, water supply or sewerage disposal would be for a non-commercial, non-industrial purpose or user and thus excluded in view of the exclusionary clause in clause (b) of WCS definition; and (iii) construction of canals, pipelines or conduits for transmission of water including by lift irrigation would be, when these works are conceived as integrated to a dam project, works contract "in respect of a dam" and thereby excluded from the purview of WCS." 5.1 Similarly, in Ramky Infrastructure Ltd., the Tribunal had held that such activities of construction of canals / pipelines or conduits undertaken for the Government / Government bodies would not attract levy of service tax being for non-commercial and non-i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... engineering service', 'erection, commissioning and installation services' and 'works contract service'. Pursuant to audit it appeared to Revenue that the appellants have not paid service tax on 'erection, commissioning and installation service' being construction of sewage pumping station, water treatment plants, sewage treatment plant and sewage works. The SCN further observes that the appellant assessee had pleaded that the works of laying of pipelines for sewage etc. are not for commerce and trade and as such the same is exempted from service tax in terms of provisions of Explanation (ii)(b) of Section 65(105)(zzzza) of the Finance Act, 1994. The appellant contested the show cause notice and the same was adjudicated and the proposed dema ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... period of limitation is not invocable. 4. The ld. AR for Revenue relies on the impugned order. 5. Having considered the rival contentions, we are satisfied that the issue now stands settled by the Larger Bench of this Tribunal in M/s. Lanco Infratech Ltd. (supra) and also confirmed by order of the Hon'ble Madras High Court (supra) in Indian Hume Pipes Ltd. wherein it has been held that such works executed by the appellant in the nature of sewerage works, laying of pipe and for water supply falling under Explanation (ii)(b) fall under the definition of "works contract service" and were also exempted under the classification commercial and industrial construction service prior to 1-6-2007, as explained by the Larger Bench. Further, we fin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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