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TMI Blog2019 (4) TMI 2076X X X X Extracts X X X X X X X X Extracts X X X X ..... ut merit - There are three definitions that are relevant for resolution of the dispute. The service sought to be taxed in section 65 (105) (zzd) of Finance Act, 1994 has remained unchanged since 1st July 2003 save that erection was incorporated on 10th September 2004. The targeted provider of the service, described as commissioning and installation agency in section 65(105)(zzd) was, prior to 10th September 2004, defined in section 65(29) and, thereafter expanded by incorporation of erection to reflect the amendment in section 65(105)(zzd). In our opinion, it is the third, pertaining to the activity that was sought to be taxed, as amended from time to time, that requires our attention. The legal position is, thus, unambiguously clear. The t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f lifts" as a particular description, with effect from 16th June 2005, in section 65 (39a) of Finance Act, 1994 that defines "erection, commissioning or installation" thereby excluding the said activity from the purview of taxation which, till then, was limited to "erection, commissioning or installation of plant, machinery or equipment", had not been taken into consideration in the impugned order. Reliance is placed on the decision of the Tribunal in Commissioner of Central Excise, Indore v. Kehems Engineering Pvt Ltd [2016 (41) STR 307 (Tri-Del)]. 3. It is further submitted that the appellant, in the course of execution of the task, is no mere contractor of labour but also supplies materials in furtherance of a composite contract which, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot without merit. There are three definitions that are relevant for resolution of the dispute. The service sought to be taxed in section 65 (105) (zzd) of Finance Act, 1994 has remained unchanged since 1st July 2003 save that "erection" was incorporated on 10th September 2004. The targeted provider of the service, described as "commissioning and installation agency" in section 65(105)(zzd) was, prior to 10th September 2004, defined in section 65(29) and, thereafter" expanded by incorporation of "erection" to reflect the amendment in section 65(105)(zzd). In our opinion, it is the third, pertaining to the activity that was sought to be taxed, as amended from time to time, that requires our attention. 6. "Commissioning or installation" in se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... though such separator is absent between the two sets of activities after the amendment of 16th June 2005, the separate enumeration after the commonality of "installation" in both is indicative that legislative intent is not mere disambiguation but of expanding the tax base. Any other construction would be disharmonious because all the new enumeration can, in some way, be related to the existing taxable activity. This lends credence to the finding in re Kehems Engineering Pvt Ltd and, in particular, to 7. "We find that in the Board Circular No. 62/11/2003-S.T., Dated 21- 8-2003 it is mentioned in para 1.2 thereof that installing a boster pump, ari-conditioner, water filter, water heater, etc., would be covered under definition of ECIS. How ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lause (ii) and vice versa. So as installation of air-conditioning is expressly covered under clause (ii), it cannot be covered under clause (i) and as clause (i) covers everything covered by the definition of ECIS prior to 16-6-2005, it was outside the scope thereof (i.e., ECIS prior to 16-05-2005)." therein. furthermore, the scope for taxing of the service component of "works contracts" with the incorporation of section 65(105)(zzzza) of Finance Act, 1994, was considered by the Hon'ble Supreme Court in re Larsen & Toubro Ltd and its was held that:- 15. "A reading of this judgment, on which counsel for the assesses heavily relied, would go to show that the separation of the value of goods contained in the execution of a works contract w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n territory namely into such portion of such cost, expenses and profit as would be attributable in the works contract to the transfer of property in goods in such contract. This being the case, we feel that the learned counsel for the assesses are on firm ground when they state that the service tax charging section itself must lay down with specificity that the levy of service tax can only be on works contracts, and the measure of tax can only be on that portion of works contracts which contain a service element which is to be derived from the gross amount charged for the works contract less the value of property in goods transferred in the execution of the works contracts. This not having been done by the Finance Act, 1994, it is clear tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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