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TMI Blog2025 (1) TMI 542X X X X Extracts X X X X X X X X Extracts X X X X ..... xation of service contracts simpliciter and not composite works contracts, such as are contained on the facts of the present cases.' Hon ble Kolkata High Court in M/S. LARSEN TOUBRO LIMITED VERSUS ASSISTANT COMMISSIONER, SERVICE TAX COMMISSIONERATE, DIVISION-III, KOLKATA OTHERS [ 022 (12) TMI 523 - CALCUTTA HIGH COURT ] examined the issue of intimation regarding the exercise of option to pay service tax under compounded Scheme of Works Contract Service and observed that in the absence of statutory format, it cannot be held that the option should be exercised in a particular fashion. Conclusion - The services which are non-vivisectible are to be classified under Works Contract Service which came into existence after 01.06.2007 and such services cannot be taxed under any other Head before 01.06.2007. Appeal allowed. - HON BLE MR. S. S. GARG, MEMBER ( JUDICIAL ) And HON BLE MR. P. ANJANI KUMAR , MEMBER ( TECHNICAL ) Shri Parikshit Agarwal, CA and Ms. Shruti Khandelwal, Advocate for the Appellant Shri Anriam Meena and Shri Aneesh Dewan, Authorized Representatives for the Respondent ORDER P. ANJANI KUMAR: M/s Bestech India Pvt. Ltd., the appellants, are engaged in provision of Com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... - Chennai) 3. Learned Consultant submits that the appellants have rightly discharged service tax under Works Contract Service exercising one of the two options available; the appellants have exercised the option and reflected the same in the ST-3 Returns; exercising the option is procedural and substantial right of the appellants cannot be taken away merely for the fact that they have not given declaration/ intimation of the intent to avail the compounded Scheme. The issue is no longer res judicata. He relies on the following cases: M/s Nitson Amitsu Pvt. Ltd. Vs. Commr. of Service Tax, Kolkata-II Dated 22.03.2018 cited as: 2018 (4) TMI 1322- CESTAT KOLKATA Mehta Plast Corporation Vs. Commr. of Central Excise, Jaipur Dated 01.05.2014 cited as: 2014 (5) TMI 1131-CESTAT NEW DELHI M/s Pooja Marbles Vs. CST, New Delhi Dated 26.08.2016 cited as: 2016 (10) TMI 620- CESTAT NEW DELHI Areva T D India Ltd. Vs. CCE ST, LTU Chennai dated 01.10.2021 cited as 2022 (59) GSTL 80 (Tri. - Chennai) Harsh Constructions Pvt Ltd Vs. CCE, Nashik dated 05.03.2019 cited as 2020 (37) GSTL 217 (Tri. - Mumbai) 4. Learned Consultant further submits that the demand was based on ST-3 Returns filed by the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble Apex Court held that: 24. A close look at the Finance Act, 1994 would show that the five taxable services referred to in the charging Section 65(105) would refer only to service contracts simpliciter and not to composite works contracts. This is clear from the very language of Section 65(105) which defines taxable service as any service provided . All the services referred to in the said sub-clauses are service contracts simpliciter without any other element in them, such as for example, a service contract which is a commissioning and installation, or erection, commissioning and installation contract. Further, under Section 67, as has been pointed out above, the value of a taxable service is the gross amount charged by the service provider for such service rendered by him. This would unmistakably show that what is referred to in the charging provision is the taxation of service contracts simpliciter and not composite works contracts, such as are contained on the facts of the present cases. It will also be noticed that no attempt to remove the non- service elements from the composite works contracts has been made by any of the aforesaid Sections by deducting from the gross value ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r entitlement cannot be denied 4.1 This issue has been squarely covered by the Hon'ble Tribunal in the case of B.R Kohli Construction Pvt. Ltd (supra) and Jija Builders (supra) and has held that such option can be exercised in case of ongoing projects as well. The relevant portion has been extracted below: We find that in view of the legal position settled by the Hon'ble Supreme Court in Larsen Toubro Limited (supra) the appellant is not liable to any service tax in respect of these indivisible composite works contract prior to 1-6-2007. As such, subject to fulfilment of the conditions, the appellants are eligible to discharge service tax on such works contract, after 1-6-2007, in terms of composition scheme of 2007 The reason for denial of the benefit recorded in the impugned order is not sustainable We find considering the facts and circumstances of the case, the imposition of penalties on the appellant is not justified. The tax liability of the composite works contract has been a subject matter of large number of litigations and the final legal position was clarified only after the decision of the Hon'ble Apex Court, as above in such situation, no penalty can be impo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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