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TMI Blog2024 (3) TMI 351X X X X Extracts X X X X X X X X Extracts X X X X ..... i Suresh Kumar Agarwal, Director of the Company, it appeared to Revenue that the respondent assessee is liable to pay service tax under the head Works Contract Service as defined under Section 65 (105)(zzzza) read with Section 65(30a) on the activity of row houses in a gated community. Accordingly, show cause notice dated 13.08.2014 was issued invoking the extended period of limitation demanding service tax for the period 2009-10 to March 13 for Rs. 5,27,13,977/- under the composition scheme, further penalty was also proposed under Section 78 and 77 of the Act. 3. The show cause notice was adjudicated on contest. The appellant had in their reply to show cause notice interalia urged that after acquiring land they prepare the lay out by dividing into plots as well as space for common amenities like roads, park, parking space etc. After getting the required permission from the Local Authorities, they sell developed plot(s) to individual buyers. Thereafter, the appellant enters into agreement with the buyer of the plot for undertaking construction of the single house/villa. The respondent have developed two projects namely i) Prestige County and ii) CSK Green Villas at Shamshabad and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the land belonging to buyer, amounts to construction of a single residential unit. Further, admittedly construction of such house/villa is for personal use of the buyer and is excluded from the purview of service tax. Reliance was placed on Board Circular No. 108/2/2009 dated 29.01.2009, wherein it was clarified by the Board - if the ultimate owner enters into a contract for construction of a residential complex with the promoter/builders/developer, who himself provides service of design, planning and construction and after such construction, the ultimate owner receives such property for his personal use, then such activity would not be subjected to service tax, because this case would fall under the exclusion provided in the definition of 'residential complex'. 8. It was further held, that the activity of construction of single residential unit is excluded from payment of service tax, as per definition of service tax itself. 9. So far taxability with effect from 01.07.2012 is concerned it was observed that the individual buyers of the plot have got the building plan approved in their name, and there after got the house/villa constructed from the respondent assessee. It was ob ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e relating to free membership of the buyer to the common amenities in the gated community is mentioned, the other set does not mention the same. Admittedly, each of the gated community consists of more than 12 residential units/houses and thus the activity fits into the definition of residential complex. 14. Further urges that the Learned Commissioner have erred in not considering the common facilities in the gated community, jogging park, swimming pool etc., which respondent assessee had agreed to provide to the buyer as per the construction agreement. Further, reliance is placed on the definition of residential complex under Section 65(91a) of the Act which reads as followed: "residential complex" means any complex comprising of- (i) a building or buildings, having more than twelve 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 the 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d by this Tribunal in Esha Homes Vs Commissioner [2012 (25) STR 465 (Tri-Chennai)] in the Interim Stay Order dated 20.10.2011. Reliance is also placed on the ruling of Co-ordinate Bench in the case of M/s Modi and Modi Constructions [2021 (45) GSTL 398 (Tri-)] wherein the dispute under similar facts was for the period January 2009 to December 2011. This Tribunal have held that "the construction of houses in a gated community, being more than 12 with common facilities, will qualify as a residential complex, observing that in the case of Micro Marvel Projects, the full definition under Section 65(91a)" was not considered, as is evident from the Final Order of the said case. Further, in that case the Tribunal held that the show cause notice itself states that the plots along with semi finished buildings were sold to the buyers under sale agreement/deed. Thereafter, a separate agreement was entered with the individual plot/home owners for completion of the building. In other words, there is no agreement for completion of the entire complex, but there are a number of agreements with each individual owner for completion of their building. In other words, the individual owner is engaging ..... X X X X Extracts X X X X X X X X Extracts X X X X
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