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TMI Blog2019 (1) TMI 381X X X X Extracts X X X X X X X X Extracts X X X X ..... cords and accounts relating to RIL project are maintained by appellant at its Hyderabad office - Thus the jurisdiction of Hyderabad Commissionerate cannot be questioned. The contract awarded to appellant is a composite one involving construction, erection, commissioning and installation of plant equipment, structure, instrumental, electrical, etc.,; it is nobody s case that services rendered under contract can be bifurcated activity wise for the tax implication; Revenue Authorities as well as the appellants were unanimous in their submissions that the entirety of the contract is to be taken as a single indivisible contract and taxability thereof or otherwise should be decided. In terms of contract, appellant was to construct a gas processing plant with certain alloyed facilities called as OT - The appellant was also to undertake the construction of certain common and infrastructure facility such as helipad; hanger; ATF refuelling facility; Radio room, portable water treatment system, permanent facilities like canteen building, office building, first aid centre; security control room; swipe and control access system; permanent warehouses; administrative buildings; accommodation buil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ating authority. In a pure service contract which is based on cost plus model, as is in the instant case, the essential character of the service rendered can be derived from details of the man hours spent for each activity along with the cost of such manpower. This aspect needs consideration to determine the essential character of the service rendered under the composite contract on the aforesaid basis. Extended period of limitation - Held that:- We are not examining this plea as the same would be relevant only if on remand the adjudicating authority comes to a conclusion that the services rendered were taxable under the head of CICS - the issue left open for determination by the adjudicating authority. Appeal allowed by way of remand. X X X X Extracts X X X X X X X X Extracts X X X X ..... clared taxable services under the head 'exempted Services' in ST-3 Returns. 2. The appellants have not disclosed the exemption notification for availing such exemption. 3. The appellants have knowingly camouflaged the value received from OT project along with host of other projects for which they have claimed exemption. 4. The appellants have not sought any opinion from the department on the taxability of the present transaction. 5. The appellants did not disclose the activity undertaken by them at the OT in reply to letter dated 21.2.2007. 6. The audit conducted in October 2007 was a routine affair. A.2 In this regard, the appellants submit as follows: 'Bonafide Belief' that the said service does not come under the purview of 'Commercial or Industrial Construction' service A.3 Firstly, the extended period is not invokable as there was no suppression of facts with intent to evade payment of service tax. The appellants were under a bonafide belief that the said service does not come under the purview of 'Commercial or Industrial Construction' service. This belief is strengthened by the decision of the Commissioner (Appeals II), Hyderabad in the case of IVRCL Inf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal must perform its duty as a last fact finding authority is indeed an unassailable legal proposition. However, it has performed it or otherwise would depend on the facts and circumstances of each case and we must find out whether in this case the Tribunal has failed in its duty expected from it to be performed in law. It is not fair to read only one paragraph of the order under appeal or by picking out some sentences therefrom. To read the order in appeal in such a manner and consider the finding in isolation would be unjust and unfair. The Commissioner (Appeals) in this case held that the assessee was expected to perform certain duty and that is of full disclosure of facts. In the present case, the assessee was visited with a show cause notice of 9th December, 2005. That followed a show cause notice of 9th September, 2003, which was issued in the normal period of one year and duly adjudicated by an order dated 27th February, 2004. The second show cause notice, invoking the larger period (December, 2002 to March, 2003) alleged suppression and misdeclaration by the assessee, which was also the allegation in the earlier show cause notice and duly adjudicated. In such a factua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, they applied the principle of noscitur a sociis to held that infrastructure alone will be covered. Firstly, it is not an opinion obtained by the appellants. RIL had obtained opinion from their consultants. In any case, the opinion obtained from charter accountant was in contradiction with the Circular issued in 2005, which provided that roads constructed in private complex were also exempt from service tax. WITHOUT PREJUDICE TO ANY OF THE ABOVE SUBMISSIONS, THE APPELLANTS ARE ENTITLED TO THE BENEFIT OF NOTIFICATION NO. 1/2006-ST DATED 1.3.2006 B.1 Without prejudice to the above submission, in case the demand is confirmed then the benefit of abatement Notification 1/2006-ST dated 1.3.2006 must be extended to the appellants. B.2 Relevant part of the Notification No. 1/2006-ST dated 1.3.2006 is reproduced as under: "Effective rate of service tax for specified services- Percentage of abatements In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994) (hereinafter referred to as the Finance Act), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts the taxable servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y CENVAT so far used in 'Commercial or Industrial Construction Service'. There is no dispute from department on the fact that the appellants are not entitled for the benefit of above Notification 1/2006. iv) As per the contract, it is a cost-plus contract, whatever cost is incurred by the appellants, the invoice is raised by them on RIL along with mark-up. The contract is service contract, however many of the items such helmet, staging materials, electricity, water, etc. which are used in rendition of output service is being provided by the appellants as well. v) The appellants have not taken any CENVAT credit of duty on inputs or capital goods or the CENVAT credit of service tax on input services, used for providing construction of transport terminal. The same is evident from ST-3 returns of the period in dispute itself. vi) Further, the appellants had also not availed the benefit of Notification No. 12/2003-ST dated 20.06.2003. B.4 After introduction of Notification 1/2006, the appellants are maintaining separate books of account and have not availed or utilized any CENVAT so far used in 'Commercial or Industrial Construction Service". Some credit taken in relation to 'Er ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the cases wherein the contract in question is a composite contract of supply of material as well as the supply of services. In fact, this was the argument by the department before Hon'ble Supreme Court in CST Vs. Bhayana Builders (P) Ltd., [2018-TIOL-66-SC-ST], that the abatement is given to utilize the cost of material used in such transactions and the free supply of material is also liable to be included. Negating the contention of the revenue, the Hon'ble Apex Court held that the above argument of the department is not supported by any material. B.7 Accordingly, the value of free material supplied by the service receiver is not included in value of taxable service for the purpose of claiming abatement under Notification No. 1/2006-ST 1.3.2006 in view of decision of the larger bench of the tribunal in case of M/s Bhayana Builders Pvt. Ltd., Vs. CST[2013-TIOL-1331-CESTAT-DEL-LB] (page 42-57 of the compilation) affirmed by CST Vs. Bhayana Builders (P) Ltd., [2018-TIOL-66-SC-ST] (page 58-64 of the compilation). Relevant portion is reproduced as under: "17. Faced with the aforesaid situation, the argument of the Learned Counsel for the Revenue was that in case the assessees d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vice recipient. It also makes it clear that valuation of gross amount has a causal connection with the amount that is charged by the service provider as that becomes the element of 'taxable service'. Thirdly, even when the explanation was added vide notification dated March 1, 2005, it only explained that the gross amount charged shall include the value of goods and materials supplied or provided or used by the provider of construction service. Thus, though it took care of the value of goods and materials supplied by the service provider/assessee by including value of such goods and materials for the purpose of arriving at gross amount charged, it did not deal with any eventuality whereby value of goods and material supplied or provided by the service recipient were also to be included in arriving at gross amount 'gross amount charged'. 19.Matter can be looked into from another angle as well. In the case of Commissioner, Central Excise and Customs, Kerala v. M/s. Larsen & Toubro Ltd. - (2016) 1 SCC 170 = 2015 (39) STR 913 (S.C.). This Court was concerned with exemption notifications which were issued in respect of 'taxable services' covered by sub-clause (zzq) of clause (105) rea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orms part of the cost of the subcontractor which results in distortion of the credit scheme. To take care of such a situation Notification No. 1/2006 ST dated 1.3.2006 had been issued extending the abatement scheme to construction service provider. Payment on the 33% of the total value under Notification No. 1/2006 ST dated 1.3.2006 is coupled with the condition of non-availment of CENVAT credit. After introduction of Notification 1/2006, the appellants are maintaining separate books of account and have not availed or utilized any CENVAT so far used in 'Commercial or Industrial Construction Service'. Some credit taken in relation to 'Erection, Installation or Commissioning Service'. B.11 Hence, the benefit of Notification No. 1/2006-ST has to be extended to the appellants. CONSTRUCTION SERVICE IS NOT THE PREDOMINANT ACTIVITY UNDERTAKEN BY THE APPELLANTS IN THE PRESENT TRANSACTION. HENCE, THE ACTIVITY CANNOT BE CLASSIFIED UNDER 'COMMERCIAL OR INDUSTRIAL CONSTRUCTION SERVICES'. SECTION 65A(2)(b) OF THE FINANCE ACT, 1994 IS ONLY APPLICABLE ON TWO OR MORE TAXABLE SERVICE AND NOT IN CASE WHERE IN NON-TAXABLE SERVICES ARE ALSO INVOLVED. C.1 Section 65A(2)(b) of the Finance Act, 199 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 65A (b) of the Finance Act, 1994, it can be inferred that it is applicable only in the cases wherein two or more taxable services are involved. Reliance is placed upon Cox & Kings India Ltd., Vs. CST, 2014 (35) STR 817 (T) (page 91-103 of the compilation). The relevant portion is reproduced as under: "(iii) In our considered view, the provisions of Section 65A have no direct application. This provision provides a guide to the classification of taxable services, where in any circumstances, a taxable service is, prima facie classifiable under two or more sub-clauses of Section 65(105). The provision clarifies that in any such situation, the sub-clause of Section 65(105) which provides the most specific description (of the service provided) must be preferred to another which provides a more general description. Sub-clause (b) states that a composite service, consisting of a combination of different services, which cannot be classified in the manner provided in clause (a), shall be classified as if they consisted of a service which gives them their essential character, in so far as this criterion is applicable. (iv) As the activity of planning and scheduling on the one hand a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of roads, airports, railways, transport terminals, bridges, tunnels and dams;] [Emphasis supplied] D.2 Section 65(25b) of the Finance Act, includes only those construction services that are rendered for construction of a 'new building', civil structure', 'pipeline' or 'conduit'. D.3 The present activity undertaken by the appellants is not construction of a 'building'. D.4 The word 'building' is defined in various dictionaries as follows: 1. As per New Oxford Dictionary means 'a structure with roof and walls such as house, school, or factory'. 2. As per Webster's Ninth New Collegiate Dictionary means 'a usually roofed and walled structure built for permanent usage.' 3. As per Black's Law Dictionary means 'a structure designed for habitation, shelter, storage, trade, manufacture, religion, business, education and the like. A structure or edifice enclosing a space within its walls and usually, but not necessarily covered with a roof.' D.5 In view of the above dictionary meanings, a 'terminal' cannot be said to be a 'building' as it is not a structure with roof and walls. In any case, the terminal constructed by the appellants may include some building like structures ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ALSO NOT POSSIBLE IN ABSENCE OF ANY MACHINERY PROVISION. E.1 As per the averments made in the show cause notice, there is no doubt as to the fact that the present activity undertaken by the appellants is a composite service contract. The activity undertaken by the appellants in the present matter is a turnkey contract comprising of engineering, erection, installation, commissioning, electrical, mechanical, instrumental, construction, etc. E.2 In this regard, reference can be made to the definition of 'works contract service' under Section 65 (105) (zzzza) of the Finance Act, 1994 which expressly provides for inclusion of 'turnkey projects' under its ambit. The relevant portion is reproduced as under: (zzzza) "Taxable service" means - any service provided or to be provided to any person, by any other person in relation to the execution of a works contract, excluding works contract in respect of roads, airports, railways, transport terminals, bridges, tunnels and dams. Explanation. - For the purposes of this sub-clause, "works contract" means a contract wherein, - (i) transfer of property in goods involved in the execution of such contract is leviable to tax as sale of g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .3 Section 65(105)(zzq) defines the taxable service in relation to 'commercial or industrial construction service' as under: "to any person, by a commercial concern, in relation to commercial or industrial construction service". F.4 Section 65(25b) of the Finance Act, 1994 excludes services provided in respect of roads, airports, railways, transport terminals, bridges, tunnels and dams from the ambit of 'Commercial or Industrial Construction Service'. The services provided by the appellants to the customer viz. M/s Reliance Industries Limited are in the course of development of a 'transport terminal'. Hence, the same are excluded from the levy of service tax. The services provided by the appellants are in relation to of construction of 'transport terminal'. F.5 Since the term and expression 'transport terminal' has not been defined under the Finance Act, 1994 the same has to be understood in their ordinary or commercial parlance. F.6 The meaning of the term 'terminal' as defined in the following dictionaries: a) Chambers 21st Century Dictionary an installation at the end of a pipeline or at a port where oil is stored and from where it is distributed. ETYMOLOGY: 19c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted with a storage unit or junction on a transportation line where raw materials are store for example, similar to the present case, a transport terminal on an oil or gas transportation line. Transportation through pipeline is a well-known mode of transportation of goods F.11 The term 'Transport terminal' may not only be associated with transportation by road, rail or air. Transportation through pipeline is a well-known mode of transportation of goods in the form of liquid or gas. Section 65(105) (zzz) of Finance Act, 1994, as amended with effect from 16.6.2005 specifically introduced taxable service under head of 'transport of goods other than water through pipeline or other conduit'. The onshore terminal is nothing but a transport terminal for transportation of gas through pipelines. F.12 In the present case, the major facilities at the onshore terminal of M/s Reliance Industries Limited at Gadimoga, near Kakinada and its purpose in brief are as under: Description of the facility Purpose of the facility Slug catchers Removal of bulk water Production separator Separating water and MEG Inlet gas heater To heat the gas Gas dehydration package Removal of water MEG R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... merely because gas is being processed at the said onshore terminal, the same would not take the onshore terminal out of the purview of the definition of a 'transport terminal'. F.18 If the goods are packed, repacked etc. at the freight container stations for onward transportation of the goods to the customers in containers by road, would the same render the container stations as 'industrial plants' and accordingly, would not qualify for the exclusion granted to 'transport terminals'. The answer to the above question is clearly in the negative. The decision of the Hon'ble CESTAT in Afcons Infrastructure Ltd., Vs. CST, Mumbai, 2015 (37) STR 850 (T) is distinguishable from the matter in dispute in the present case. F.19 The decision of the Hon'ble CESTAT in Afcons Infrastructure Ltd., Vs. CST, Mumbai, 2015 (37) STR 850 (T) (page 300-307 of the compilation) is distinguishable on the following counts: 1. The Article "The Geography of Transport Systems by Dr. Jean Paul Rodrigue and Dr. Brian Slack" relied upon by the Bench, itself says that a 'Terminal' is any location where freight and passengers either originates, terminates, or is handled in the transportation process. Thus, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which were included by the "means" clause. G.2 Even assuming that the transport terminal constructed by the appellant is not for 'public use or benefit', the exclusion in no manner specifies that it would apply only to 'Governmental or public works'. Even assuming the appellant's activities are not for the purpose of 'public utility' they would still be eligible to the benefit of the exclusion under Section 65(25b) of the Finance Act, 1994. G.3 In Afcons Infrastructure Ltd., Vs. CSE, 2015 (38) STR 194 (T) (page 286-290 of the compilation), construction of viaduct and stations of Delhi Metro Railway Project for Delhi Metro Corporation (DMRC) under turnkey contracts was held to be exempted from 'Commercial or Industrial Construction Services' under the head 'railways' even if it is not part of 'Indian Railways.' G.4 Similarly, while deciding exemption under Exemption Notification No. 25/2007-S.T shall be given to 'public port' only or 'private ports' can also claim such exemption, CESTAT in Punj Lloyd Ltd. vs. CCE, 2015 (40) STR 1028 (T) (Page 291-294 of the Compilation) held that the Notification nowhere implies that CICS in relation to construction of public port only eligib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... admittedly for construction of road only." …Emphasis Supplied. G.6 Reference is also made on Board's Circular No. B1/6/2005- TRU dated 27.7.2005 (Page 311-314 of the Compilation). THE EXCLUSION FROM LEVY OF SERVICE TAX IS AVAILABLE TO 'TRANSPORT TERMINAL' BECAUSE IT IS AN 'INFRASTRUCTURE PROJECT' AND NOT BECAUSE IT IS A 'PUBLIC UTITLITY'. THE PRINCIPLE OF 'NOSCITUR A SOCIIS' AS WELL AS THE 'EJUSDEM GENERIS' IS NOT APPLICABLE IN THE PRESENT CASE. H.1 The principle of 'Noscitur a sociis' is not applicable because the said principle is applicable when two or more words which are susceptible of analogous meaning are coupled together; in such a case the two or more words are understood to be used in their cognate sense. They take colour from each other, that is, the more general is restricted a sense analogous to the less general. In the current case, the words used in the definition of 'Commercial or Industrial Construction' are "roads, airports, railways, transport terminals, bridges, tunnels, dams, ports or other ports". There are no two words in the above group of words, which are susceptible to analogous meaning. Each of the words have a different meaning. H.2 The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be occupied primarily with commerce or industry or engaged, or to be engaged, primarily in commerce or industry. I.3 In the instant case, the said construction activity is undertaken by the Appellants as a social obligation for local people of Gadimoga Village. In other words, the said construction activity would not be use in commerce or industry. The residential complex (workmen colony) has been constructed for personal use. The said colony would be used as residence by the workmen. Therefore, the aforesaid activity undertaken by the Appellants would not be liable to service tax under taxable head of 'commercial or industrial construction' service as defined under the Finance Act, 1994. I.4 Without prejudice, a major portion of the infrastructure facilities being constructed by the Appellants are: * Construction of Civil works for comprehensive Protected Water Supply Scheme (CPWS) Scheme at Gadimoga village, * Haul Road work, Access Bridge to Workman Colony, * Flyover Bridge, Road widening work etc. I.5 The said infrastructure projects would independently be excluded from the levy of service tax under excluded categories of "road", "bridge", "dam" etc. I.6 Wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e did not have jurisdiction to demand service tax on the services rendered in Kakinada which fell outside the jurisdiction of Hyderabad-II Commissionerate. INTEREST AND PENALITY NOT PAYABLE K. No interest is payable as the levy is itself unsustainable; L. No penalty is imposable under Section 76 of the Act as the Appellants were under a bona fide belief that no tax is payable; M. Secondly, the department was already aware about the said activities at Onshore Terminal as the Appellants vide their letter dated 5.3.2007, in reply to the department letter dated 21.2.2007, submitted list of various contractors undertaking the aforesaid activity and the amounts paid to them. Simultaneously, investigation was also started by Visakhapatnam Commissionerate in 2007 itself. Further, AG Audit was also undertaken during the month of October 2007, wherein contract and other related documents were sought by the department. The Appellants duly submitted the contract along with other relevant documents. Even Though all the relevant documents were available with department, DGCEI erroneously delayed the issuance of show cause notice and eventually issued the present show cause notice on 31.7 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thing but a refinery/plant with various processing facilities whereas the gas is received along with impurities is totally baseless. The natural gas cannot be transported directly from the gas field to the prospective buyer through a pipeline without being treated for impurities. After explaining us the entire process, Learned Counsel requested time for filing written submissions which was permitted and filed which are as under: 1. "The present submissions are pursuant to the hearing held on 11/9/2018 in the matter. At the time of the hearing a synopsis was filed on behalf of L&T and the present submissions are in response to the same and oral submissions made by the Counsel. Revenue also filed written submissions on the said date and the same may also be kindly given due consideration. 2. Point No. 1: Extended period is not invokable. Submissions: (i) The period of the first demand is 9/06 to 3/08. SCN was issued on 31/7/2008. In the instant case, the last dates for issuing SCN within normal period of one year were 23/10/2008 and 23/4/2009 respectively, for the periods 4/07 to 9/07 and 10/07 to 3/08. Thus, extended period has been invoked only in respect of the assessment per ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of contract. Significantly, this period covers the period for which SCN was issued beyond the normal period. Hence, the demand is not hit by limitation. 3. Point No. 2: L&T is entitled to the benefit of notification no.1/2006. Submissions: In view of the order of the LB of the Tribunal in the case of M/s Bhayana Builders 'P' Ltd., Vs. CST [2013-TIOL-1331-CESTAT-DEL LB] affirmed by CST Vs. Bhayana Builders 'P' Ltd., [2018-TIOL-66-SCST], appellant's submissions have considerable force. However, the quantum of benefit to be allowed should be subject to verification by the department. Claims as to non-availment of benefit under 12/2003 and of CENVAT credit would also require to be verified by the original authority. 4. Point No. 3. Construction service is not the predominant activity in the present transaction. Hence, classification under CICS is not correct. Submissions: Officials of L&T have themselves averred that the predominant nature of the contract is construction of OT. Statement of Shri Udaybhaskar dated 1/4/2008 refers in this context. Detailed scope of work clearly points to substantial civil construction activity, such as pile foundation, base civil structure for er ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... No. 6: OT constructed by L&T is a 'transport terminal' and hence excluded from the purview of CICS Submissions: (i) Kind attention is invited to Paras 2.4.1 to 2.4.9 of written submissions filed on 1/9/2018 on behalf of Revenue. These submissions have dealt with all the points raised by the appellants. (ii) RIL has obtained licence under the Factories Act and also under the C Ex Act as a manufacturing unit. This is an admission of the fact that what happens in the OT is not mere movement of gas through pipeline. OT is the premises where a complex manufacturing process is carried out. (iii) The pipelines from the sub-sea facility end at Pig receivers. Thereafter, the well fluids are subject to a complex process of manufacturing gas which have to satisfy stringent quality/specifications and other bye products. The manufactured gas is significantly different from the input, namely, well fluids. No pipeline runs through the OT. Thus, no movement of goods through a running pipeline is incident in the present case. (iv) The decision of the Mumbai Bench of the Hon'ble Tribunal in the case of Afcons Infrastructure is squarely applicable as far as the issue whether the constructed b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eld along with due interest." 5. We have considered the submissions made at length by both sides and perused the records. 6. As far as the jurisdiction is concerned, we do not find any merits the appellants arguments, as they have themselves applied for and got Centralized Registration with Hyderabad Commissionerate-II, and the Commissionerate has jurisdiction to issue the demand even when the services are provided outside territorial jurisdiction of Hyderabad Commissionerate-II, which comes out clearly from statement of Mr. Udaybhasker, that they have been granted Centralized Registration even for A.P. & Chattisgarh. Further it is not in dispute that all the records and accounts relating to RIL project are maintained by appellant at its Hyderabad office. Thus the jurisdiction of Hyderabad Commissionerate cannot be questioned. 7. On perusal of the contracts, we find that it is undisputed fact that the contract awarded to appellant is a composite one involving construction, erection, commissioning and installation of plant equipment, structure, instrumental, electrical, etc.,; it is nobody's case that services rendered under contract can be bifurcated activity wise for the tax i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant, it seems, that essential character of composite contract is imparted by the CICS activities, which are taxable. As such, the contention that entirety of the service provided by the appellant is to be regarded as non-taxable is rejected. 10. We have to now consider whether demand for tax can be sustained under the category CICS as held by Commissioner. We note paragraph 10 of show cause notice dated 31.07.2008, some analysis was made to as to taxability of the services rendered by appellants with reference to three possible categories namely WCS, ECIS and CICS; after considering all the implications the notice state that the activity of appellants needs to be classified under CICS. In coming to such a conclusion the notice relied upon Section 65A(2)(b) of the Finance Act, 1944, and applied the test of predominant activity undertaken by the appellant. The Notice records the activity of appellant is not a WCS, as there is no transfer of property in goods. The reason for excluding the service from the head "Erection Commissioning or Installation Services", was that the appellant was not a "Commissioning and Installation Agency". The allegation in the notice is that activity of ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the services provided herein, were in the nature of ECIS services, while some others, again on a standalone basis, were either construction services falling under the head CICS or were non-taxable services as noted herein above. Since both sides are unanimous in contending that the contract is a composite contract and indivisible one, not amendable to being broken down in to its separate components attracting different tax classifications, it was necessary for the adjudicating authority to have examined which of the two taxable services i.e. ECIS or CICS imparted the essential character to the contract as a whole. It seems that no such exercise has been conducted by the adjudicating authority. 13. We are unable to come to a definite conclusion on this point as there is shortage of material on record for us to say with any degree of certainty, which of the two taxable services impart the essential character to the contract in question. The submission of the appellant before us that most of the work carried out was in the nature of ECIS services is not supported by any verifiable data or facts and figures. In the course of hearing we were shown a video presentation of the entire ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hether the Onshore terminal is a transport terminal or otherwise arise. We direct that in case the adjudicating authority on remand concludes that the contract is aptly classifiable under the head of CICS and not ECIS, he would also consider whether the Onshore Terminal can be termed as a transport terminal or not. In doing so the adjudicating authority would take into account the ratio laid down by the co-ordinate bench of this tribunal in the case of AFCONS (supra) as also the submissions that the appellant may urge. 16. The assesse has also claimed benefit of exemption in terms of Notification No. 1/2006-ST dated 1.3.2006 and has also cited the judgement of the Apex Court in the case of Bhayana Builders (supra). We agree that in case the adjudicating authority comes to a conclusion that the activity is taxable under the head of CICS and does not fall in the exclusion of being a transport terminal, then tax only on 33% of the value of the services rendered alone would be payable in terms of Notification No. 1/2006-ST dated 1.3.2006. Even the counsel for the Revenue in his written submissions does not seriously dispute the appellant's eligibility to the benefit of this exemption. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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