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TMI Blog2021 (1) TMI 1213X X X X Extracts X X X X X X X X Extracts X X X X ..... cision in Real Value Promoters is squarely applicable to the facts of the case in both these appeals. The demand made under construction of residential complex service cannot therefore sustain - Appeal allowed - decided in favor of appellant. - Service Tax Appeal No.40678-40679 of 2015 - Final Order Nos. 40711-40712/2021 - Dated:- 15-1-2021 - Ms. Sulekha Beevi C.S., Member (Judicial) and Shri P. Anjani Kumar, Member (Technical) Shri M.N. Bharathi, Advocate for the Appellant Shri S. Balakumar, AC (AR) for the Respondent ORDER The issue involved in both these appeals being the same, they were heard together and are disposed by this common order. 2. In Appeal No. ST/40678/2015, the brief facts are as under:- 2.1 During the course of audit, it was noticed that the service provider was providing Construction of Residential Complex Service and also receiving services under Transport of goods Agency Service. From April 2008 onwards, though they were receiving advances in the ST-3 returns for the period April 2008 to July 2008 and April 2009 to March 2010, they had shown nil receipts . Further, for the period February 2009 to March 2009, it was reflected in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mended on 4.1.2008. Circular No. 108/02/2009-ST dated 29.1.2009 clarified that only after the full payment for the service of construction or the sale deed is executed, service tax is liable for the service provider, till then the service is considered as self service . The Circular also clarified that if the service provider who provided services like planning and construction, over a contract with the ultimate owner that will be exclusion from the definition of residential complex and will not attract service tax. Only after the entire payment is made by the buyer for the completion of construction, the activity of construction will be deemed liable for service tax as per the Government Circular DOF 334/1/2006-TRU dated 26.2.2010. Thus in view of clarifications provided by the circulars, there is no liability to pay service tax as it is only self service on the part as the developer for the period prior to 1.7.2010. Pune Commissionerate issued Trade Notice dated 15.2.2011 which clarified that service tax on construction of residential complex would attract service tax from 1.7.2010 and if any amount collected prior to this date, the same was required to be dep ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , Bangalore I Vs. Keerthi Estates Pvt. Ltd. 2019 (26) GSTL 227 (Tri. Bang.) and M/s. Vijay Shanthi Builders Ltd. Vs. Commissioner of Service Tax, Chennai 2017-TIOL-3845-CESTAT-MAD. 4. In Appeal No. ST/40679/2015, the facts are as under:- 4.1 On the basis of the intelligence gathered and on scrutiny of Nil ST3 returns , filed by the assessee, investigations were conducted by the department. The appellants were rendering services under the category of construction of residential complex service for the period from January 2009 to March 2013. They were doing construction projects by executing joint venture agreement with the land owners to construct multi-storey residential complex. As per the joint venture agreement, the super-built area, car parking and open space will be shared in the ratio 35% for the land owner and 65% for builders / developers. Consequent to the joint venture agreement, power of attorney for the land was handed over to one of the partner Shri B.N. Subramani for the purpose of sale of undivided portion of the land to the prospective buyer of the flats. Thereafter, the company namely M/s. V.R. Nachimuthu (CBE), the appellant herein, would execute the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... truction services rendered by the appellants are composite in nature involving materials as well as services. This Tribunal in the case of Real Value Promoters (supra) had analysed the issue whether the demand under construction of residential complex services is sustainable in services which are of composite in nature. After introduction of Works Contract Services, the demand can be made only under Works Contract Services in the case of construction services which are composite in nature. The relevant paragraphs of the said discussion which brings out in detail the issue is as under:- 3.5 The issue as to whether a composite contract involving provision of service as well as transfer of property in goods could be covered under CICS and CCS from the date of introduction of service tax levy on such services was, being litigated upon which was finally settled by the Hon ble Supreme Court in the case of CCE Vs. Larsen Toubro Ltd. 2015 (39) STR 913 SC. The Apex Court has observed that in as much as section 67 of the Act, dealing with valuation of taxable services, refers to the gross amount charged for service, the services of CICS and CCS would cover only pure service activities ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CICS / CCS into it, the scope of coverage of these services are distinct. While the definition of CICS / CCS would cover such construction activities without involving any transfer of property in goods (Example:- Where all materials required for the construction are supplied by the service recipient and the service provider is engaged only for provision of construction service), a composite construction activity would fall only under WCS. xxxx xxxxx xxxx 3.11 In the subject appeal, all the demands confirmed are in respect of composite contracts (commercial buildings, residential buildings, service provided to buyers and service provided to landowners). If the plea that such demands under CICS and CCS for the period both prior to and post 01.06.2007 is not sustainable is upheld, there is no need to advance any further arguments specific to the projects in question. xxxx xxxxx xxxx 8. In the light of the discussions, findings and conclusions above and in particular, relying on the ratios of the case laws cited supra, we hold as under:- a. The services provided by the appellant in respect of the projects executed by them for the period prior to 1.6.2007 being in the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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