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TMI Blog2018 (7) TMI 1941X X X X Extracts X X X X X X X X Extracts X X X X ..... f both goods and services could not be vivisected for imposition supply of both goods and services. The Appellant intended to seek registration as a works contract service provider only, as evident from the application for STC Code filed alongwith the application for registration on 30 May 2007 coupled with the fact that even after the grant of registration under CICS, the Appellant was discharging service tax at the rate of 2% under the works contract composition scheme for payment of tax rules - no negative inferences can be drawn from the fact that registration was initially granted to the Appellant under the taxable category Commercial or Industrial Construction Services. it is well settled that there is estoppel in law and the pers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der the composition scheme available to works contractor under the VAT Law prescribing a rate of 2%. 2. The Finance Bill 2007 proposed inclusion of a new category of taxable service i.e. Works Contract Services and the same was notified to take effect from 1st June 2007 vide Notification No. 23/2007 dated 22 May 2007. The Appellant applied for registration under the said new category on 31 May 2007 itself. It is the submission of the Ld. Counsel that while carrying out an on the spot examination of the application, Appellant was given to understand by the department that the said new service did not exist and that Appellant have to take registration under the taxable category Commercial or Industrial Construction Services . ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ipts as works contract under the VAT laws which could not again be subject to service tax as the two levies are mutually exclusive. An appeal against the order of the Adjudicating Authority was also rejected by the Lower Appellate Authority on the following grounds: (A) The Appellants have not come forward with any material with reference to which it may be established that they were not providing services under the head of CICS or ECIS and that payment of VAT on materials involved in the execution of the said services does not constitute any bar within the frame work of the statute. (B) Not even a single works contract executed between the Appellant and the receiver of service has been enclosed alongwith the App ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed 22 May 2007 issued by the Joint Secretary (TRU) clarifies as under: Contracts which are treated as works contract for the purpose of levy of VAT/sales tax shall also be treated as works contract for the purpose of levy of service tax. This is clear from the definition under Section 65 (105) (zzzza) . Therefore, the Order-in-Appeal is contrary to the decision of the Hon ble Supreme Court in the Larsen Toubro case (Supra) in so far as it holds that the payment of VAT in respect of the work orders does not constitute any bar in classifying such work orders under the category CICS or EICS prior to 1 June 2007 as these were not service contracts simplicitor. 8. The Hon ble Supreme Court in the L T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... omposition scheme for payment of tax rules. The circumstantial evidence is also clearly pointing to the fact that the intention was to take registration under the category works contract services as the application was mooted on 30 May 2007 just on the cusp of the introduction of Works Contract Services. Therefore, no negative inferences can be drawn from the fact that registration was initially granted to the Appellant under the taxable category Commercial or Industrial Construction Services. In any event, it is well settled that there is estoppel in law and the person cannot be saddled with a statutory liability which was never there on account of an inadvertent mistake committed by such person. We observe that the levy of VAT and servic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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