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TMI Blog2023 (7) TMI 64X X X X Extracts X X X X X X X X Extracts X X X X ..... g or civil structure - the activity /service provided by the appellant is precisely a service of providing commercial or industrial construction/construction services as has been held by Commissioner (Appeals) in the order under challenge. Scope of SCN - HELD THAT:- In the present case, the appellant was acting as a sub-contractor/a job worker. The question of him being the owner of the goods used in pile formation works does not at all arise. The main contractor / service recipient himself was the owner of the goods. Commissioner (Appeals) has failed to appreciate the basic mandate of the definition of works contract service. Hence the services have wrongly been classified as works contract services. Commissioner (Appeals) has otherwise nowhere denied that the structure constructed by the appellant is in relation to the construction of bridges etc. which is different from structure mentioned in the definition of ECIS - the Commissioner (Appeals) has committed an error while classifying the service under work contract service. While doing so he has gone beyond the scope of Show Cause Notice. It is clear that services provided by the appellant are purely the services of CICS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 06. It was also found that in terms of master Circular No.96/7/2007-ST dated 23.08.2007, the appellant despite being a subcontractor is liable to pay service tax. The appellant even though had taken service tax registration but was found to have been filing NIL returns. Accordingly, vide Show Cause Notice (SCN) No.06/23732 dated 15.09.2011 the service rendered by the appellant was proposed to be called as Erection, Commissioning and Installation Service (ECIS) instead of Commercial or Industrial Construction Service (CICS). Service Tax amounting to Rs.19,43,878/- alongwith the proportionate interest and the appropriate penalties were also proposed to be recovered from the appellant. 2. The said proposal has been confirmed vide Order-in-Original No.89/2016 dated 06.12.2016 holding that the services rendered by the appellants are in nature of Erection, Commissioning and Installation Service (ECIS) as contrary to Construction Services for which the appellant got himself registered. The appellant as subcontractor is thus held liable to discharge the service tax liability under the ECIS. Due to the above noticed contradiction committed by the appellant as far as the nature of servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further error by holding the services in question as works contract service. The findings of Order under challenge are therefore, beyond the scope of Show Cause Notice and the order under challenge is liable to be set aside on this score itself. 5. Finally, it is submitted that the extended period of limitation has wrongly been invoked. The appellant was duly registered with Service Tax Commissionerate. The returns were also duly been filed as NIL Returns purely on the ground that the services rendered by appellant either were exempted or liability was being discharged by the main contractor. It is also brought to the notice that during the period in question i.e. 2004-2011 there was a huge confusion about the liability of the subcontractors to pay service tax. There were several decisions supporting the case of subcontractors that they are not liable. However, there were few decisions holding that even subcontractor is liable to pay the service tax. Ld. Counsel has impressed upon that such confusion and contradiction is sufficient to hold that there was no intent of the appellant to evade the payment of duty. Extended period has wrongly been invoked while issuing the Show Cause ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on 65 (39a) of Finance Act, 1994 which reads as follows:- (39a) erection, commissioning or installation means any service provided by a commissioning and installation agency, in relation to, (i) erection, commissioning or installation of plant, [machinery, equipment or structures, whether pre-fabricated or otherwise]; or (ii) installation of (a) electrical and electronic devices, including wirings or fittings therefore; or (b) plumbing, drain laying or other installations for transport of fluids; or (c) heating, ventilation or air-conditioning including related pipe work, duct work and sheet metal work; or (d) thermal insulation, sound insulation, fire proofing or water proofing; or (e) lift and escalator, fire escape staircases or travelators; or (f) such other similar services;] Section 65 (25b) of Finance Act, 1944 defines commercial or industrial construction service to mean as follows:- [ commercial or industrial construction ] means (a) construction of a new building or a civil structure or a part thereof; or (b) construction of pipeline or conduit; or (c) completion and finishing services suc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sl.No. Name of the Contractee Work Order No. Date Work allotted 1 Gammon India Ltd. 8514/17 dt.01.06.2006 Initial Pile Load Test 2 Gammon India Ltd. 8514/15 dt. 02.07.2006 Boring of test pile 3 Sanyukt Nirmata Letter dated 19.05.2006 Bored pile for school of charitable trust 4. Swastik Construction Co. Noticee's letter dated 30.08.2005 Piling work for nallah 5. PWD, New Delhi 23(13) SJHPD/2005/47 dated 17.01.2006 Initial load testing of piles 6. Gangotri Enterprises Ltd. Letter dated 07.06.2006 Laying of bored pile 7. Aanav Construction Company Noticee's letter dated 22.02.2005 Piling bore holes at Ludhiana Sl. No. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e activity of the appellant is dominantly in relation of a building or a civil structure meant for construction of a new building/civil structure. We are therefore of the opinion that this activity cannot be called as the activity of Erection, Commissioning or Installation Services which is about installation of several things as mentioned in the definition in clause (a) to clause (f) of section 65 (39a) of Finance Act in an already constructed building or civil structure. With these observations, we are of the opinion that the activity /service provided by the appellant is precisely a service of providing commercial or industrial construction/construction services as has been held by Commissioner (Appeals) in the order under challenge. 11. We further observe that in the order under challenge, the Commissioner (Appeals), in addition, has classified the service as works contract service. But from the definition as mentioned above, the basic mandate for any activity to be called as works contract service is that the activity should involve the transfer of property in goods which are involved in the execution of such contract. In the present case, the appellant was acting as a sub- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contractor. Though the Department has relied upon Mega Circular No.96/2007 dated 23.08.2007 wherein it has been held that services provided by sub-contractors are in the nature of input services, service tax is therefore leviable but we hold that the said circular is not applicable in the given set of circumstances, where the activity of subcontractor is not a deviation of the exempted activity of the main contractor. The main contractor has been awarded the contract of constructing Roads, Pillars, Bridges etc. and appellant as sub-contractor is constructing support to said construction. 14. As already held above, his activity falls under construction services, we accordingly, hold that there is neither any misrepresentation nor any suppression of fact on part of the appellant. The extended period has wrongly been invoked while issuing the impugned Show Cause Notice. For the same reason, there appears no circumstance for the imposition of penalty. Resultantly the entire demand otherwise gets barred by time. 15. In the light of entire above discussion, we hold that the order of Commissioner (Appeals) while remitting back the matter to the Original Adjudicating Authority after ..... X X X X Extracts X X X X X X X X Extracts X X X X
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