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TMI Blog2023 (4) TMI 9X X X X Extracts X X X X X X X X Extracts X X X X ..... ts. It is true that w.e.f July 01, 2012 construction of complex is a declared service, but the Exemption Notification exempts services by way of construction, erection, commissioning or installation of original works pertaining to a single residential unit otherwise than as a part of a residential complex have been exempted - the Commissioner (Appeals) was not justified in holding that the appellant would not be entitled to the benefit of the Exemption Notification. The Commissioner (Appeals) was also not justified in holding that the refund was hit by the principles of unjust enrichment. As per the work orders, service tax was to be borne by the appellant and the Commissioner (Appeals) has also found, as a fact, that the contract awarded by the Housing Board to the appellant mentions that service tax shall be borne by the contractor - Commissioner (Appeals) was, therefore, not justified in rejecting the refund claim of the appellant on the ground of unjust enrichment. Appeal allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... ork orders submitted by the appellant, I find that it has not been mentioned in the work orders that the construction is for independent and individual residential units which are not part of residential complex. Further I find that in order to substantiate their claim the appellant has not submitted any photographs or drawing & design etc. relating to this project on the basis of which it can be substantiated that the residential units constructed are not part of residential complex. On the contrary a bare perusal of work order no. 2121 dated 8.03.2013 it is clear that 20 Nos. of residential units have been constructed in residential complex at Manpura Scheme, Abu Road and a bare perusal of work order No. 1616 dated 23.09.2013 clearly manifests that 34 nos. of residential units have been constructed in residential complex at Manpura. That the Rajasthan Housing Board has given contracts for construction of residential units in residential complex is also clear from the clause of work order No. 1616 which runs as "This work order shall be subject to service tax as per service tax law since the work order is inclusive of service tax, RHB shall deduct its share of service tax lia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nstruction of Complex" means (a) Construction of a new residential complex or a part thereof; or (b) Completion and finishing services in relation to residential complex such as glazing, plastering, painting, floor and wall tiling, wall covering and wall papering, wood and metal joinery and carpentry, fencing and railing, construction of swimming pools, acoustic application or fittings and other similar services; or (c) Repair, alteration, renovation or restoration of, or similar services in relation to, residential complex." 15. A 'residential complex' has been defined in section 65(91a) of the Finance Act as follows: "Residential Complex - Section 65(91a) 'Residential Complex' means any complex comprising of - (i) a building or buildings, having more than 12 residential units; (ii) a common area; and (iii) any one or more of facilities or services such as park, lift, parking space, community hall, common water supply or effluent treatment system located within a premises and layout of such premises is approved by an authority under any law for the time being in force, but does not include a complex which is constructed by a person directly engaging any other pers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Finance Act and the observations are as follows:- "It is abundantly clear from the above provisions that construction of residential complex having not more than 12 residential units is not sought to be taxed under the Finance Act, 1994. For the levy, it should be a residential complex comprising more than 12 residential units. Admittedly, in the present case, the appellants constructed individual residential houses, each being a residential unit, which fact is also clear from the photographs shown to us. In any case, it appears, the law makers did not want construction of individual residential units to be subject to levy of service tax. Unfortunately, this aspect was ignored by the lower authorities and hence the demand of service tax. In this view of the matter, we are also not impressed with the plea made by the appellants that, from 1-6-2007, an activity of the one in question might be covered by the definition of 'works contract' in terms of the Explanation to section 65 (105)(zzzza) of the Finance Act, 1994 as amended. According to this Explanation, 'construction of a new residential complex or a part thereof' stands included within the scope of 'works contract'. B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dingly, we find that the show cause notice is not maintainable. Accordingly, we allow this appeal and set aside the impugned order. The appellant shall be entitled for consequential benefits in accordance with law." (emphasis supplied) 23. The same view was taken by a Division Bench of the Tribunal in Quality Builders & Contractor. 24. A Division Bench of the Tribunal in Shri A.S. Sikarwar vs CCE, Indore [Service Tax Appeal No. 871 of 2011 decided on 20.04.2012] also observed that service tax can be demanded only if the building concerned has more than 12 residential units in the building and such levy will not apply in cases where one compound has many buildings, each having not more than 12 residential units. This decision of the Tribunal was also assailed before the Madhya Pradesh High Court. Central Excise Appeal No. 31 of 2012 was dismissed on 01.08.2013 [Union of India vs. Shri A.S. Sikarwar]. The observations are as follows: "It is not disputed by the learned counsel for the appellant that the respondent had performed the work of the house construction of 15 HIG at Laxmi Nagar, Ujjain in the financial year 2004-05 to 2006-07. He submitted that the activity of the resp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 50% of the tax to be deposited by the Housing Board under the reverse charge mechanism was deducted by the Housing Board from the amount payable to the appellant. The Commissioner (Appeals) was, therefore, not justified in rejecting the refund claim of the appellant on the ground of unjust enrichment. 28. In Service Tax Appeal No. 50496 of 2017, the appellant constructed ground plus three floor house prior to July 01, 2012 as per the work order and the construction was completed on December 31, 2013 as per the certificate dated January 28, 2022 issued by the Rajasthan Houses Board. Thus, the concerned building had four residential units which would be less than 12 units. It would, therefore, not be taxable. 29. In Service Tax Appeal No. 50524 of 2017 issue of limitation is also involved. In Service Tax Appeal No. 30781 of 2018 (M/s. Credible Engineering Construction Projects Limited - Service Tax Appeal No. 30781 of 2018 decided on 08.02.2022 ), it was held that the limitation prescribed under section 11B of the Excise Act would not be applicable if an amount is paid under a mistaken notion as it was not required to be paid towards any duty/tax. 30. Thus, for all the reasons sta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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