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TMI Blog2023 (6) TMI 240X X X X Extracts X X X X X X X X Extracts X X X X ..... dur Taluk viz., M/s. Myoung Shin India Automotive Private Limited, M/s. Global Stamping & Welding Automotive Private Limited, M/s. Daechang India Seat Company Private Limited, M/s. Daebu Automotive Seat India Private Limited and M/s. Dae Seung Autoparts India Private Limited had combinedly given a contract for road work i.e., laying of existing road, carrying out processes like picking the existing bituminous surface, providing and laying wet mix mancadam, prime coat, dense bituminous macadam and semi-dense bituminous concrete of required specifications for a total consideration of Rs.45,87,863/-. (ii) Another agreement was entered into with M/s. Myoung Shin India Automotive Private Limited for "road work" for an amount of Rs.24,41,709/-. (iii) Scrutiny of various documents such as Form-16A (TDS Certificates) has indicated that the appellant had carried out various maintenance and repair activities of roads for the Divisional Engineer, Chennai City Roads, Divisional Engineer, Highways, Thiruvallur, Executive Officer, Puzhal Town Panchayat, Thiruvallur and for improving the existing road falling under the jurisdiction of Commissioner, Panchayat Union, Puzhal, for a total value o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs.) Cum-Tax Value (in Rs.) Rate of Service Tax Service Tax (in Rs.) 2005-06 MRS 28563734 25919904 10.20% 2643830 2006-07 MRS 33993495 30286435 12.24% 3707060 2007-08 MRS 48389888 43066828 12.36% 5323060 2008-09 MRS 67612911 60175250 12.36% 7437661 2008-09 SFC 6123418 5449820 12.36% 673598 Total 184683446 164898237 19785209 4.1 After due process of law, the Commissioner of Service Tax, Chennai vide Order-in-Original No. 88/2012 dated 26.07.2012 has confirmed the demand of Service Tax of Rs.1,07,04,221/- under proviso to Section 73(1) of the Finance Act, 1994 along with interest under Section 75 of the Finance Act, 1994. Penalty of Rs.1,07,04,221/- was also imposed under Section 78 of the Act along with penalties under Sections 77(1)(a) for non-registration and also a penalty of Rs.5,000/- under Section 77(2) for failure to file ST-3 returns on the due dates. 4.2 The Commissioner has exempted the value of services for Rs.2,21,60,111/- for the period 2006-07 and Rs.6,05,83,339/- for the period 2008-09 as these services pertained to road works done for Government agencies such as Public Works Department (PWD), Highways, etc. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mercial or industrial construction service' up to 01.06.2007 in the light of the judgement rendered by the Hon'ble Apex Court in the case of Commissioner of C.Ex. & Cus., Kerala v. M/s. Larsen & Toubro Ltd. [2015 (39) S.T.R. 913 (S.C.)]. 5.2.1 It was contended that the entire demand under maintenance or repair service of Rs.91,63,116/-, excluding JCB/Tipper hire charges, was not sustainable as it pertained to the period prior to July 2009, which was exempted by the insertion of Section 97 of the Finance Act, 2012 retrospectively for the period from 16.06.2005 to 26.07.2009, by relying on the decision in the case of K.O. Periyakaruppan v. Union of India [2018 (16) G.S.T.L. 78 (Mad.)] wherein it was held that for the period from 16.06.2005 to 26.07.2009, maintenance and repair of road was exempted under Section 97 of the Finance Act, 2012 and also on the decision in Commissioner of Central Excise & Customs, Aurangabad v. M/s. Rajdeep Buildcon Pvt. Ltd. [2015 (38) S.T.R. 696 (Tri. - Mumbai)]. He has also placed reliance on the decision rendered by Regional Bench of the CESTAT at Hyderabad in the case of Commissioner of Customs, Central Excise and Service Tax, Hyderabad-II v. M/s. Lar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... made by both the parties and records as available in this appeal. The issues that arise for consideration in this appeal are: - (1) Whether the demand of Service Tax raised for the services provided by the appellant is justified under the category of 'management, maintenance or repair' service? (2) Whether the demand under the category of 'site formation and clearance, excavation and earthmoving and demolition' service is justified? and (3) Whether extended period for demand of tax and for imposition of penalty is invocable or not in the facts of this case? 8. We find that the Commissioner of Service Tax, Chennai has exempted all the Services provided in relation to repair of roads carried out for various Government Departments and local authorities, but relying on the decision of the Tribunal in the case of M/s. Larsen & Toubro Ltd. v. Commissioner of Central Excise, Hyderabad [2010 (20) S.T.R. 113 (Tri. - Hyderabad)], it has been held that exemption from payment of Service Tax under maintenance or repair service (MRS) is available only for repair / re-laying of public roads and infrastructure facilities are "public goods" and only infrastructure items of public utility or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mumbai)] has held as under: - "5. As regards the Service Tax liability under the category of 'management, maintenance and repair service', we find that the said services were rendered by the appellant to National Highways Authority of India for the maintenance or repairs of the roads. We find that the issue is no more res integra inasmuch as vide Finance Act of 2012, retrospective exemption was granted under Section 97 and Section 98. We reproduce the same as under : "SECTION 97. Special provision for exemption in certain cases relating to management, etc., of roads. - (1) Notwithstanding anything contained in Section 66, no Service Tax shall be levied or collected in respect of management, maintenance or repair of roads, during the period on and from the 16th day of June, 2005 to the 26th day of July, 2009 (both days inclusive). (2) Refund shall be made of all such Service Tax which has been collected but which would not have been so collected had sub-section (1) been in force at all material times. (3) Notwithstanding anything contained in this Chapter, an application for the claim of refund of Service Tax shall be made within a period of six months from the date on whic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ve. Accordingly we do not find any infirmity in the view adopted by Commissioner (Appeals), inasmuch as the contract in the present appeal is admittedly for construction of road only." (Emphasis supplied) 9.4 In the light of the above, we hold that the demand pertaining to maintenance and repair service in respect of roads is not sustainable in view of the exemption under Section 97 of the Finance Act, which has retrospective effect for the period from 16.06.2005 to 26.07.2009. For according exemption, no distinction needs to be made between private and public roads. 10.1.1 On the issue of demandability of Service Tax for the consideration received towards hiring of JCB and Tipper, we find that "supply of tangible goods" under Section 65(105)(zzzzj) of the Finance Act, as a separate category, came into effect from 16.05.2008 whereas the demand was raised under maintenance or repair service against the appellant for the period from 2005-06 to 2007-08. 10.1.2 In this connection, it is relevant now to refer to the provisions of Section 65A on the classification of service, which read as given below: - "Section 65A. Classification of taxable services. - (1) For the purposes of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hich is classifiable under "site formation and clearance, excavation and earthmoving and demolition" service as defined in clause (97a) of Section 65 of the Finance Act, 1994. Recording the cum-tax benefit, the Service Tax payable was quantified as Rs.6,73,598/-. (paragraph 4.5 above) 12.2 We find from the records that the demand is raised in respect of site formation and clearance, excavation and earthmoving and demolition service on the basis of TDS Certificate issued by the Executive Engineer, SIDCO wherein it was mentioned that the assessee undertook filling-up of the low-lying area in eastern side of SIDCO Industrial Estate. The assessee's contention that the site formation service has been undertaken in connection with any laying or repair of road is not acceptable in the absence of any evidence. Even during the hearing before us, the appellant has never produced any evidence relating to the above activity. 12.3 For the above reasons, we uphold the finding of the lower authority that the activity undertaken by the appellant squarely falls under the scope of site formation and clearance, excavation and earthmoving and demolition under Section 65(97a) of the Finance Act, 1994 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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