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TMI Blog2023 (8) TMI 409X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax from 01.07.2012 onwards. VAT and Service tax are mutually exclusive levies. The present demand has sought to subject the entire value to service tax, despite the fact that the spare parts were subjected to VAT - Without prejudice, the Appellant is entitled to claim deduction on the value of goods and materials in terms of Notification No. 12/2003 ST dated 20.06.2003 - Cum-tax benefit ought to be extended to the Appellant. - There can be no interest liability and penalty fastened on the Appellant. Appeal allowed. - SHRI P. DINESHA, MEMBER (JUDICIAL) AND SHRI M. AJIT KUMAR, MEMBER (TECHNICAL) Shri Raghavan Ramabhadran, Advocate for the Appellant Shri M. Ambe, DC (AR) for the Respondent ORDER This appeal is filed by the appellant against Order in Original No.LTUC/485/2013-C dated 19.12.2013 passed by the Commissioner, LTU, Chennai. 2. Brief facts of the case are that the appellant herein are manufacturers of cars and have obtained service tax registration for the services rendered by them. The cars manufactured by the appellants are sold to Authorized Dealers (dealers), who in turn sell the cars to the ultimate buyers. During the audit, it came ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... el for the appellant submitted that the extended warranty plans are composite contracts involving labour by way of repairs and material by way of parts being replaced. Under the service tax regime, taxability on service tax portion of a composite works contract was made taxable for the first time w.e.f. 01.06.2007 vide insertion of Section 65(105)(zzzza). He placed reliance on the decision of the Hon ble Apex Court in Commissioner v. Larsen Toubro Ltd. [2015 (39) S.T.R. 913 (S.C.)]. He hence stated that Service tax is not leviable on composite contract for maintenance and repair of vehicle which entails both supply of goods and services for the period upto 01.07.2012. VAT and Service tax are mutually exclusive levies. The present demand has sought to subject the entire value to service tax, despite the fact that the spare parts were subjected to VAT. He stated that without prejudice, the appellant is entitled to claim deduction on the value of goods and materials in terms of Notification No. 12/2003 ST dated 20.06.2003. Cum-tax benefit should also be extended to the Appellant. Further the demand of Rs.3,03,65,844/- is time-barred. There can be no interest liability and penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Normal wear tear Depreciation Negligence b. Scheduled Service Plan (SSP) Periodic maintenance services and replacement (if required) relating to engine oil, oil filter, air filter, etc., Labour costs for the same. Mechanical failure Electrical failure Normal wear and tear Accident repairs Tyres Fuel c. Total Maintenance Plan (TMP) Periodic maintenance services Mechanical and electrical failures Wear and tear parts Labour costs Accident repairs Tyres Fuel Whenever a customer invokes the extended warranty, the customer approaches the dealers, who provide the repairs and replace defective parts if necessitated. The dealers then raise claims upon the appellant for reimbursement of the value of the repairs and parts replaced. The appellant then reimburse the dealers for the claims so raised, inclusive of applicable Value Added Tax ( VAT ) component on the parts replaced. The impugned or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of carrying out, (a) erection, commissioning or installation of plant, machinery, equipment or structures, whether pre-fabricated or otherwise, installation of electrical and electronic devices, plumbing, drain laying or other installations for transport of fluids, heating, ventilation or air-conditioning including related pipe work, duct work and sheet metal work, thermal insulation, sound insulation, fire proofing or water proofing, lift and escalator, fire escape staircases or elevators; or (b) construction of a new building or a civil structure or a part thereof, or of a pipeline or conduit, primarily for the purposes of commerce or industry; or (c) construction of a new residential complex or a part thereof; or (d) completion and finishing services, repair, alteration, renovation or restoration of, or similar services, in relation to (b) and (c); or (e) turnkey projects including engineering, procurement and construction or commissioning (EPC) projects Explanation (ii)(d) to the above section makes it clear that works contract for carrying out repair is in relation to construction of a new building or a civil structure or a part thereof, or of a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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