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TMI Blog2021 (2) TMI 400X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant would be classifiable as works contract as they involved goods as well as labour services - The Commissioner therefore, dropped the demand for the period prior June 1, 2007. But for the demands for the period w.e.f. June 1, 2007 the Commissioner proceeded to examine whether the particular work performed under works contract is exempted from levy of service tax under Notifications issued from time to time. A Division Bench of the Tribunal in M/S GURJAR CONSTRUCTION VERSUS COMMISSIONER CENTRAL EXCISE, JAIPUR-II [ 2019 (5) TMI 717 - CESTAT NEW DELHI] also examined such a position and observed that a demand made under a particular category cannot be sustained under a different category - In view of the aforesaid decisions of the Tribunal, it has to be held that the Commissioner was not justified in confirming the demand of service tax under the category of works contract for the period post June 1, 2007 even if the levy of service tax was not exempted under Notifications, since, the show cause notice that demand it service tax under the three categories namely (i) commercial or industrial construction, (ii) construction of complex and (iii) management, maintenance or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is reproduced below: 4. We find that in consequences of the decision of the Hon ble Supreme Court in the case of Commissioner of Central Excise and Customs, Kerala vs. Larsen and Toubro Ltd.[2015 (39) S.T.R 913 (S.C)] on taxability of works contract prior 1 st June 2007 which the original authority did not have as a guide when adjudicating the show cause notices, each of the contracts undertaken by the appellant would need to be examined for taxability itself. We also find that some of the buildings for which works were undertaken by the appellant are undoubtedly rented out but these can hardly be categorized as being put to commercial lease as to bring it within the ambit of the definition of commercial or industrial construction in section 65(25b) of Finance Act, 1994. We also observe that in a few of the contracts executed for the Delhi Government and municipal bodies, consideration was yet to be received by the appellant. 5. Considering the factual matrix and the decision of the Hon ble Supreme Court supra, we are of the opinion that the original authority would need to have a fresh look at the claims made by the appellant. We, therefore, direct the original au ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commercial Construction Service These organizations are autonomous bodies and also engaged in commercially exploiting their products/ research. 3. Work related to Govt. Buildings Police Headquarters, Moulana Azad Medical College Commercial Construction Service Construction for non commercial purposes including Police building, college Hostel are not taxable 4. Work related to PSUs like HAL Commercial Construction Service PSU are engaged in commercial venture, hence are taxable 5. Work related to Govt., Buildings given on rent like Delhi High Court Advocates Chambers, Community Centre Golf Link, Mohan Singh Place, Chanakya Bhawan, Mayur Bhawan, Bharat Gas Commercial Construction Service Buildings built by government authority but leased out on commercial terms like Barat Ghar used as Mandap on which NDMC was charging service tax. 6. Road maintenance at Aurbindo Marg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as it involves goods as well a labour and services and composite contracts for non-commercial purposes provided to Government were exempted, retrospectively by virtue of Section 98 of the Finance Act, 1994 and thereafter by the Mega Exemption Notification. (ii) Thus, for any contract to be covered under Works Contract Service as prescribed under Section 65 (105) (zzzza), following two conditions are required: (i) There must be transfer of property in goods involved in the execution of such contract and that property should be leviable to tax like VAT etc. (ii) The contract must be covered under the one of the five categories as prescribed in the definition of Works Contracts; On perusal of the each of the works contracts, I am of the view that all the above mentioned projects undertaken by the IGC are not covered under the services mentioned in the classification alleged in the show cause notice. In view of the decision of Hon ble Supreme Court in the case of Commissioner of Central Excise and Customs, Kerala Vs. Larsen Toubro Ltd. [2015 (39) STR 913 (SC)] and the definition of Works Contracts as prescribed under section 65 (105) (zzzza) of Fina ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Department have been considered. 15. It is w.e.f. 1 June, 2007 that clause (zzzza) was inserted in section 65(105) of the Finance Act in relation to execution of works contract . Taxable Service under Section 65(105)(zzzza) is defined as : 65(105)(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 goods, and (ii) such contract is for the purposes of carrying out,- (a) erection, commissioning or installation of plant, machinery, equipment or structures, whether pre-fabricated or otherwise, installation of electrical and electronic devices, plumbing, drain laying or other installations for transport of fluids, heating, ventilation or air-conditioning including related pipe work, duct work and sheet metal work, thermal insu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd that each of the works contract undertaken by the appellant are not covered under the three services namely (i) commercial or industrial construction, (ii) construction of complex and (iii) management, maintenance or repair mentioned in the first show cause notice. The Commissioner further recorded a categorical finding that the activities undertaken by the appellant would be classifiable as works contract as they involved goods as well as labour services. 18. The Commissioner therefore, dropped the demand for the period prior June 1, 2007. But for the demands for the period w.e.f. June 1, 2007 the Commissioner proceeded to examine whether the particular work performed under works contract is exempted from levy of service tax under Notifications issued from time to time. 19. Learned Counsel for the appellant has submitted that there was no necessity for the Commissioner to examine whether service tax is exempted under the Notifications because a demand made under a particular category of service cannot be confirmed under a different category of service. 20. That submission advanced by the learned Counsel for the appellant has force and it is n ..... X X X X Extracts X X X X X X X X Extracts X X X X
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