9911796707
TMI Blog2023 (9) TMI 295X X X X Extracts X X X X X X X X Extracts X X X X ..... ered to BHEL, the Appellant was a consortium partner - HELD THAT:- From the arrangement, it is evident that the Lead Partner has collected and paid service tax on the full value received for the services rendered to BHEL. The Appellant has rendered their respective share of the work order to BHEL, but service tax pertains to that portion of service was also paid by the Lead Partner, as they have raised the bills on the total value with BHEL - In view of the above, the Appellant were not subcontractors in this case and hence the clarification issued by the Board Vide Master Circular No. 96/7/2007 ST dated: 23.08.2007 is not applicable in this case. Accordingly, the demand confirmed in the impugned order on this count is not sustainable. In case of services rendered to main contractors namely M/s L T, S L Kolkata, TATA Project West Bengal - main defense is that they have not collected service tax from the main contractors and hence the demand of service tax on them is not sustainable - HELD THAT:- From clarification issued by Board by Circular No. 96/7/2007 ST dated: 23.08.2007, it is observed that a subcontractor is liable to pay service tax, even if the main contractor pays s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tegories of Erection, Commissioning and Installation Services, on the taxable amount of Rs.4,65,11,026/-received by them during the relevant period. The relevant extract (in tabular format) of the Audit Report is as follows: Year Taxable Amount ST Ed. Cess S. H.E. Cess Total 2008-09 1,19,83,731 14,38,047 28,760 14,380 14,81,187 2009-10 3,00,44,540 30,04,454 60,089 30,044 30,94,587 2010-11 (upto Sep, 2010) 44,82,755 4,48,275 8,965 4,482 4,61,722 Total 4,65,11,026 50,37,496 3. The Ld. Commissioner, Dibrugarh issued a Show Cause Notice dated 14.12.2011, demanding service tax of Rs.50,37,496/- along with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... red two types of services. In the first category, they have rendered services as a consortium partner, along with the Lead Partner, M/s Rajshekhar Constructions, to BHEL. In the second category, they rendered services as a sub-contractor to the main contractors namely M/s L T, S L Kolkata, TATA Project West Bengal. We observe that the impugned order considered the Appellant as sub-contractor on both these categories and confirmed service tax by citing the Master Circular No. 96/7/2007 ST dated: 23.08.2007, issued by Board. we observe that there is a distinction in both the above categories, which has not been considered in the impugned order. 9. In case of services rendered to BHEL, the Appellant was a consortium partner. In this case, the Appellant and the Lead Consortium Partner M/s Rajshekhar Constructions Pvt. Ltd. together were the service providers and BHEL was the service receiver. Establishment of a Consortium Agreement was necessitated because the Lead Consortium Partner was qualifying all criteria for allotment of the work by BHEL, except the criteria of Fabrication and Erection of structural works. Accordingly, BHEL allowed the First Bidder M/s Rajshekhar Construction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roduced below: 999.03 / 23.08.07 A taxable service provider outsources a part of the work by engaging another service provider, generally known as subcontractor. Service tax is paid by the service provider for the total work. In such cases, whether service tax is liable to be paid by the service provider known as sub-contractor who undertakes only part of the whole work. A sub-contractor is essentially a taxable service provider. The fact that services provided by such sub-contractors are used by the main service provider for completion of his work does not in any way alter the fact of provision of taxable service by the subcontractor. Services provided by subcontractors are in the nature of input services. Service tax is, therefore, leviable on any taxable services provided, whether or not the services are provided by a person in his capacity as a subcontractor and whether or not such services are used as input services. The fact that a given taxable service is intended for use as an input service by another service provider does not alter the taxability of the service provided. 12. From t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
