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TMI Blog2024 (8) TMI 660X X X X Extracts X X X X X X X X Extracts X X X X ..... werage disposal, when provided to Government/Government undertakings would be for non-commercial, non-industrial purposes, even when executed under turnkey/EPC contractual mode and would fall within the ambit of clause (b), Explanation (ii) of Section 65(105)(zzzza); and would consequently not be exigible to Service Tax, in view of the exclusion enacted in clause (b). Thus, the appellant is not liable to pay service tax for the activity undertaken by them for laying down the pipelines for Government/Government Undertakings for supply of water from KWA in Thiruvananthapuram City. In view of the this , we find that the appellant is not liable to pay service tax - there is no liability of the appellant to pay service tax in this case - issue is answered in favour of the appellant. Whether the refund claims filed by the appellant of service tax paid, which was not payable by the appellant is hit by the provisions of Section 11B of the Central Excise Act, 1944, or not? - HELD THAT:- The Hon ble High Court in the case of MDP Infra (India) Private Limited [ 2019 (2) TMI 208 - MADHYA PRADESH HIGH COURT ] has examined the issue although the appellant was not liable to pay service tax, which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s. The appellant was also providing services in the nature of construction/laying down of pipelines for which it is duly registered with the service tax authorities. The Appellant was executing several composite projects for various local authorities and municipal corporations. Vide an agreement dated 03 October 2006 and a Letter of Acceptance dated 19 September 2006, the Appellant was awarded a contract by Kerala Water Authority (KWA) for the construction of distribution system for water supply for Thiruvananthapuram City. Prior to 01 June 2007, such services, although classifiable as Commercial or Industrial Construction Services (CICS), were not taxable as the same were non-commercial and nonindustrial in nature and service tax was accordingly not charged on the invoices raised upon KWA before the period 01 June 2007. However, with effect from 01 June 2007, works contract services were covered as a taxable service under Section 65(105)(zzzza) of the Finance Act, 1994. The Appellant was of the opinion that the services provided by them were covered under works contract services as an EPC/turnkey project, started to raise invoices reflecting service tax and suo-moto depositing the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... therefore, the statutory time limit under Section 11B of the Central Excise Act, 1944, would not be applicable to the facts of this case. To support, he relied on the decision of the Telangana High Court in the case of M/s Credible Engineering Construction Projects Limited reported in 2024 (4) TMI 1041. 3.2 He further submitted that as the appellant has not received any service tax from the service recipient and the same has been communicated to them from Tokyo Engineering Consultants Company Limited , therefore, the appellant has passed the bar of unjust enrichment. Therefore, the refund claims are to be allowed. 3.3 On the contrary, the ld.A.R. for the Revenue, submitted that the refund claims are hit by bar of unjust enrichment as held by the Hon ble Madhya Pradesh High Court in the case of MDP Infra (India) Pvt. Limited Vs. Commissioner of Customs, Central Excise CGST reported in 2019 (29) GSTL 296 (M.P.). He further submits that the issue of taxability and unjust enrichment has not been dealt with by the ld.Adjudicating Authority. Therefore, the matters are to be remanded back to the ld.Adjudicating Authority to consider the issue. 4. Heard both the parties and considered the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... imarily for industry or commerce? (B) Whether construction of canals for irrigation purposes and laying of pipelines including as part of lift irrigation systems, undertaken for the Government/Government undertakings is liable to Service Tax under WCS as turnkey projects, including engineering, procurement and construction or commissioning projects under clause (c) of Explanation (ii) in the definition of WCS or is excluded from the ambit of WCS since it is in respect of a Dam and thus stands excluded from WCS, as defined? (c) Whether, turnkey projects, including engineering, procurement and construction or commissioning (EPC) projects specified in clause (c) is merely an enumeration of the mode of execution of taxable services specified in clauses (a) to (d) or is a wholly distinct taxable service and is exigible to Service Tax as an independent species of works contract service? (D) Whether, even if clause (c) in Explanation (ii) of WCS is considered a distinct and independent service, where construction of canals for irrigation purposes and laying of pipelines either as part of lift irrigation systems or for transport and distribution of water is undertaken for Government/Govern ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct. Consequently, a turnkey/EPC contract must be classified under any of the clauses (a) to (d), Explanation (ii), Section 65(105)(zzzza). The bundled bouquet of services provided as turnkey/EPC contract, classifiable as Commercial or Industrial Construction Service (CICS) prior to 1-6- 2007, would be classifiable under clause (b), Explanation (ii), Section 65(105)(zzzza) on and from 1-6-2007 and would not be exigible to Service Tax if the rendition of service thereby is primarily for non-commercial, non-industrial purpose, in view of the exclusionary clause in clause (b) of the definition of WCS. This is the only possible and harmonious interpretation possible of the several clauses under Explanation (ii) of Section 65(105)(zzzza), a distinct taxable service defined with constituent elements thereof substantially drawn from elements of pre-existing taxable services like ECIS, CICS or COCS; and other services when bundled to amount to turnkey/EPC; (iii) Construction of canals/pipelines/conduits to support irrigation, water supply or for sewerage disposal, when provided to Government/Government undertakings would be for noncommercial, non-industrial purposes, even when executed unde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... part thereof; or (b) construction of pipeline or conduit; or (c) completion and finishing services such as glazing, plastering, painting, floor and wall tiling, wall covering and wall papering, wood and metal joinery and carpentry, fencing and railing, construction of swimming pools, acoustic applications or fittings and other similar services, in relation to building or civil structure; or (d) repair, alteration, renovation or restoration of, or similar services in relation to, building or civil structure, pipeline or conduit, which is (i) used, or to be used, primarily for; or (ii) occupied, or to be occupied, primarily with; or (iii) engaged, or to be engaged, primarily in, commerce or industry, or work intended for commerce or industry, but does not include such services provided in respect of roads, airports, railways, transport terminals, bridges, tunnels and dams. 2. Thus the essence of the definition is that the commercial or industrial construction service is chargeable to service tax if it is used, occupied or engaged either wholly or primarily for the furtherance of commerce or industry. As the canal system built by the Government or under Government projects, is not fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 12-13, dated 15-6-2012, E-tender No. 14204 and office No. 1589. (iv) Construction of Model School Building at Sabalgarh for PWD, PIU Division-4 Gwalior (Department of Government of Madhya Pradesh) work order No. 2/2012-13, dated 15-6-2012, E-tender No. 14209 and office No. 1599, dated 2-11-2012. (v) Construction of Model School Building at Pahadgarh for PWD, PIU Division-4, Gwalior (Department of Government of Madhya Pradesh) work order No. : 2/2012-13, dated 15-6-2012, E-tender No. 14209 and office No. 1601, dated 2-11-2012. (vi) Construction of Boundary wall at National Law Institute University, a university established by State Legislature of Madhya Pradesh, Bhopal vide ref. no. by act No. 41 of 197, Letter Ref. No. 83/NLIUB, dated 23-1-2015. 5. That prior to 1-4-2015, the appellant was availing exemption for civil works related to State and Union Government establishments used for administrative purpose. The exemption was availed under Notification No. 12/2012 and 25/2012, dated 20-6-2016. As the notification dated 20-6-2012 was withdrawn w.e.f. 1-4-2015, the exemption from service tax on the nature of work the appellant engaged in was not available; therefore, he paid service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not arise for consideration. The appellant was under legal obligation to deposit the service tax in respect of the service rendered qua nonexempted service. The contentions that it was beyond the control of the appellant to deposit the service tax on exempted service is misconceived. Evidently, the Notification No. 12/2012 25/2012 ceased to exist w.e.f. 1-4-2015. The exemption was revived by notification dated 1-3-2016. But since it was prospective in effect, the appellant was not entitled for any exemption, which the appellant was aware of and with open mind and eyes deposited the service tax due with interest. It was only by virtue of subsequent legislation the notification was made effective from retrospective date with the stipulations that refund can be claimed within specific time provided. There was thus no ambiguity nor any dispute as would have prevented the appellant from seeking refund within the period of limitation. On these given facts the substantial question at B also does not arise for consideration. 10. We observe that the Hon ble High Court in the case of MDP Infra (India) Private Limited (supra) has examined the issue although the appellant was not liable to pa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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