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TMI Blog2019 (12) TMI 808X X X X Extracts X X X X X X X X Extracts X X X X ..... for the benefit of Notification No. 25/2012-ST dated 20.06.2012 at Sr. No. 12 (a) and (c). Therefore, on the amount for construction of EWS Flats, the appellant is not entitled to pay service tax. In view of this, for the period prior to 31.03.2015, the appellant have not to pay service tax on the construction of EWS Flats. Thus, for the period prior to 01.04.2015, the appellant is not liable to pay service tax at all on construction of EWS Flats, but thereafter, the appellant is liable to pay only 50% of the service tax on them in terms of Notification No. 30/2012-ST dated 20.06.2012 at Sr. No. 9. Cervices rendered for Construction of bridges - 12/2012-ST dated 20.06.2012 at Sr. No. 13 (a) - HELD THAT:- The construction of Multi-level car parking for Government Medical College and Hospital and contract was entered by PWD, B R [Public Works Department (Building and Roads)], Amritsar; Repair and renovation work at Medical College, Amritsar to a contract with PWD (B R), Amritsar; Meritorious School at Ferozpur to a contract with PWD (B R), Ferozpur; Construction of foot-over bridge at Amritsar to a contract with PWD (B R), Amritsar.The Sr. No. 9 in the Notification No. 3 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llowed by way of remand. - Service Tax Appeal No. 61288 of 2019 - A/61113/2019 - Dated:- 16-12-2019 - Mr. ASHOK JINDAL, MEMBER (JUDICIAL) AND Mr. BIJAY KUMAR, MEMBER (TECHNICAL) Shri Sudhir Malhotra, Advocate for the Appellant Shri Rajiv Gupta and Shri H. S. Brar, Authorised Representative for the Respondent ORDER The appellant is in appeal against the impugned order, demanding service tax amounting to ₹ 4,97,27,521/- and equivalent amount of penalty under Section 78 and a penalty of ₹ 1,00,000/- under Section 77 (2) of the Finance Act, 1994 for the period 2013-14 to 2016-17. 2. The facts of the case are that the appellant was engaged in providing Construction services in terms of Works Contract , being composite contract as per the works orders. The appellant was paying service tax, therefore, a show cause notice dated 21.11.2013 was issued to the appellant to demand service tax on 23.10.2018 and to impose penalty on the appellant. The matter was adjudicated, the demand of service tax was confirmed by invoking the extended period of limitation alongwith interest and penalty stated as above were also confirmed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 13,65,41,102/- 2015-16 S No. Name of Work Name of Department Gross Amount received A. B. C. D. 1. EWS Flats Pradhan Mantri Aawas Yojna (EWS Flats of Carpet area 45 Sqm), Improvement Trust, Amritsar 1,80,92,639/- 2. Multi-level Car Parking Government Medical Collage and Hospital 4,86,35,277/- 3. BSF quarter at Kangra BSF Defence Campus 46,70,693/- 4.* RCC Grain Shed in Khadoor Sahib Punjab Mandi Board, Tran Taran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1,68,70,995/- 6. Repair Renovation sub-office (Ajit Newspaper) office, Taylor Road, Amritsar Charitable Trust under section 12AA of Income Tax Act 4,00,000/- Total of repair works 16,28,36,352/- 7. Construction of Boys and Girls Hostel Medical College, Amritsar 1,41,75,856/- 8. Construction of Multi-Level Parking and Admin Block Medical College, Amritsar 7,73,71,451/- 9. Construction of Type-II/48 Nos. F/S residential quarters including electrical works BSF Bn. HQ Kangra 1,81,92,386/- 10. Construction of Meritorious School at Ferozpur Government Educationa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... i) BSF residential Quarters - entered into contracts with CPWD (Central Public Works Department). iv) construction of ITI Adampur entered into contract with PSIEC (Punjab Small Industries Export Corporation Ltd.) , Chandigarh; v) construction of Khalsa College, Girls Hostel, Amritsar and repair, renovation of Ajit Newspaper office at Amritsar contract with Trust. 3. The Ntfn. No. 30/2012 ST inter-alia stipulates that service tax was payable 50% each by provider and recipient of service resp. in respect of taxable services provided to a business entity registered as body corporate located in taxable territory. The clause 1 (v) to Ntfn. No. 30/2012 ST reads as under:- (v) provided or agreed to be provided by way of renting of a motor vehicle designed to carry passengers to any person who is not in the similar line of business or supply of manpower for any purpose or service portion in execution of works contract by any individual, Hindu Undivided Family or partnership firm, whether registered or not, including association of persons, located in the taxable territory to a business entity registered as body corpor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ification No. 25/2012-ST dated 20.06.2012 effective from 01.07.2012 and from that date board could not deduct service tax from bills of contractor. It has been further held that board is not entitled to pass on the burden of service tax payable on its part. Therefore, he prayed that the flats constructed for the people below poverty line, no service tax is payable. The bridges constructed by the appellant are exempt from payment of service tax. Further, in terms of Notification No. 30/2012-ST dated 20.06.2012 Sr. No. 9, they are liable to pay 50% of service tax. In the said benefit is to be given to the appellant, the appellant liability will be reduced substantially. 5. On the other hand, the arguments advanced by the Ld. Advocate were opposed by the Ld. AR who submits that for low cost houses having carpet area of 60 Sqm, the housing project should be approved by the competitive authority empowered under the Scheme of Affordable Housing in the Partnership‟ framed by the Ministry of Housing and Urban Poverty Alleviation, Government of India and same is not the case of the appellant, therefore, the appellant is not entitled for the said benefit. For constru ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 of section 65 B of the said Finance Act; 13. Services provided by way of erection, construction, maintenance, repair, alteration, renovation or restoration of,- (a) road, bridge, tunnel, or terminal for road transportation for use by general public; (b) building owned by an entity registered under section 12 AA of the Income tax Act, 1961(43 of 1961) and meant predominantly for religious use by general public; (c) pollution control or effluent treatment plant, except located as a part of a factory; or (d) electric crematorium; 14. Services by way of erection or construction of original works pertaining to,- (a) airport, port or railways; (b) single residential unit otherwise as a part of a residential complex; (c) low- cost houses up to a carpet area of 60 square metres per house in a housing project approved by competent authority empowered under the Scheme of Affordable Housing in Partnership framed by the Ministry of Housing and Urban Poverty Alleviation, Government of India; (d) post- harvest storage infrastructure f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... registered under the Central Excise Act, 1944 (1 of 1944) or the rules made thereunder; (e) any body corporate established, by or under any law; or (f) any partnership firm whether registered or not under any law including association of persons; (iii) provided or agreed to be provided by way of sponsorship to anybody corporate or partnership firm located in the taxable territory; (iv) provided or agreed to be provided by,- (A) an arbitral tribunal, or (B) an individual advocate or a firm of advocates by way of support services, or (C) Government or local authority by way of support services excluding,- (1) renting of immovable property, and (2) services specified in sub-clauses (i), (ii) and (iii) of clause (a) of section 66D of the Finance Act,1994, to any business entity located in the taxable territory; (v) provided or agreed to be provided by way of renting of a motor vehicle designed to carry passengers to any person who is not in the similar line of business or supply of manpower for any purpose or ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n sub-clauses (i), (ii) and (iii) of clause (a) of section 66D of the Finance Act,1994 Nil 100% 7 (a) in respect of services provided or agreed to be provided by way of renting of a motor vehicle designed to carry passengers on abated value to any person who is not engaged in the similar line of business Nil 100 % (b) in respect of services provided or agreed to be provided by way of renting of a motor vehicle designed to carry passengers on non abated value to any person who is not engaged in the similar line of business 60% 40% 8. in respect of services provided or agreed to be provided by way of supply of manpower for any purpose 25% 75 % 9. in respect of services provided or agreed to be provided in service portion in execution of works contract ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provisions of Section 3 of the Act, as was enacted by the State Legislature. It is a body corporate which consists of a Chairman, a Chief Administrator and such other members, as the State Government may, from time to time, appoint by a notification. The Chief Administrator shall be a person from amongst the officers of the rank of Head of the Department or Joint Secretary of the State Government. It is termed to be a local authority for the purposes of Land Acquisition Act, 1894. Section 20 of the Act provides that subject to control of the State Government the Board may incur expenditure on framing and execution of such housing schemes as may be considered necessary from time to time or as may be entrusted to it by the State Government. Every year, the Board is to prepare a budget in advance for the next year and place it before the State Government for its approval. After sanction is granted by the State Government, the same is published in the Official Gazette. The Board is authorised to borrow money for implementation of the projects, as approved with prior approval of the State Government. Section 72 of the Act provides that the State Government shall exercise superinten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le to pay various taxes, as mentioned in the clause, directly to the department in accordance with the Rules and the Regulations in force from time to time. The case of neither of the parties is that the liability, which may be put on the contractor/service provider, if tax is leviable, is being passed on to the Board, as the scheme of the Act provides for levy of tax 50 : 50 on service provider and the service recipient. Hence, the action of the Board, even if it is assumed that tax is leviable, to pass on their share of burden as per the provisions of the Act on the contractors is not envisaged in the clause. 25 . In view of our abovesaid discussion, the questions, as framed above, are answered as under : (i) On the contract for construction of BPL houses, as awarded by the Board to the petitioners, no service tax is leviable w.e.f. 1-7-2012; and (ii) the Board is not entitled to pass on the burden of service tax payable on its part, if the tax is leviable, upon the contractors. Therefore, we hold that for the period prior to 01.04.2015, the appellant is not liable to pay service tax at all on construction of EWS Flats, but thereafter, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y limit is the two exclusions mentioned therein. None of the entity is to whom services were provided fall under these two exceptions /exclusions. The Improvement Trust are Body Corporate as per section 3 of The Punjab Town Improvement Act, 1922‟ which reads as under:- Section 3 - Creation and incorporation of trust The duty of carrying out the provisions of this Act in any local area shall, subject to the conditions and limitations hereinafter contained, be vested in a board to be called The (name of town) Improvement Trust hereinafter referred to as The Trust ; and every such board shall be a body corporate and have perpetual succession and common seal, and shall by the said name sue and be sued . The Improvement Trust is in business of acquiring land, construction thereto and also body corporate as per section 3 of Punjab Town Improvement Act, 1922. The PWD(B R) are constituted under The Punjab Roads and Bridges Development Board Act, 1998 and in terms of Section 3 of the said Act defined as under : Section 3 The Board Constituted in terms of sub-section (2), shall be body corporate having p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d 20.06.2012. 18. We further take a note of the fact that during the impugned order, the appellant has also entered in Construction of Foot Over Bridge at BRTS project at Amritsar. Sr No. 13 and 14 for the services rendered during the period 2016-17 on that construction of bridges, the appellant is entitled for exemption under Notification No. 12/2012-ST dated 20.06.2012 at Sr. No. 13 (a) which reads as under:- Section 13 (a) A road, bridge, tunnel, or terminal for road transportation for use by general public. 19. In view of this, we pass the following order:- (a) For construction of EWS Flats, the appellant is entitled for benefit of exemption Notification No. 12/2012-ST dated 20.06.2012 at Sr. No. 12(a) upto 31.03.2015. (b) For services rendered for Construction of bridges, the appellant is entitled for the benefit of exemption Notification No. 12/2012-ST dated 20.06.2012 at Sr. No. 13 (a). (c) For other services and flats constructed after 01.04.2015, the appellant is entitled for the benefit of Notification No. 30/2012-ST dated 20.06.2012 at Sr. No. 9 i.e. the appellant is liable to pay 50% of the servic ..... X X X X Extracts X X X X X X X X Extracts X X X X
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