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TMI Blog2025 (2) TMI 631X X X X Extracts X X X X X X X X Extracts X X X X ..... on 35 G of the Central Excise Act, 1944 challenging the impugned order dated 4th June, 2024. Vide the said order it has been held by the ld. CESTAT that the Show Cause Notice (hereinafter "SCN") dated 11th February, 2009 stood quashed and therefore, the discharge of the said SCN was held to be in accordance with law. 4. The matter has a chequered history. The Respondent was registered with the Service Tax Department as of 12th April, 2005. The Respondent was engaged in the business of fabrication and fixing of aluminium window/doors, glazing, cladding and partition works etc., falling under completion and finishing services in relation to building or civil structures. The Respondent had availed CENVAT credit on inputs and input services as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tioner also impugns a Circular dated 4.1.2008, inasmuch as it clarifies that goods free of cost would also be leviable to service tax. In view of the above rulings as well as the judgments of this Court in Era Infra Engineering Ltd. v. UOI, W.P.(C)3048/2008, decided on 17.10.2016, this writ petition has to succeed. The impugned show cause notice is hereby quashed. The respondents are directed to proceed strictly in accordance with the directions in Era Infra Engineering Ltd. and Y.F C. Projects Pvt. ltd. (supra) and exclude the value of free materials used by the petitioner in its commercial/business activities. The writ petition is allowed in the above terms. There shall be no order as to costs." 6. The above order was then challenged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld be 'the gross amount charged by the service provider for such service provided or to be provided by him'. Whether the value of materials/goods supplied free of cost by the service recipient to the service provider/assessee is to be included to arrive at the 'gross amount', or not is the poser. On this aspect, there is no difference in amended Section 67 from unamended Section 67 of the Act and the parties were at ad idem to this extent. xxx 18) In the first instance, no material is produced before us to justify that aforesaid basis of the formula was adopted while issuing the notification. In the absence of any such material, it would be anybody's guess as to what went in the mind of the Central Government in issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... #39;gross amount charged'. xxx 20) It is to be borne in mind that the notifications in questions are exemption notifications which have been issued under Section 93 of the Act. As per Section 93, the Central Government is empowered to grant exemption from the levy of service tax either wholly or partially, which is leviable on any 'taxable service' defined in any of sub-clauses of clause (105) of Section 65. Thus, exemption under Section 93 can only be granted in respect of those activities which the Parliament is competent to levy service tax and covered by sub-clause (zzq) of clause (105) and sub-clause (zzzh) of clause (105) of Section 65 of Chapter V of the Act under which such notifications were issued. 21) For the af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, after noticing the judgment of the Delhi High Court and the fact that the Civil Appeal filed by the department to assail the aforesaid judgment was dismissed, proceeded to discharge the show cause notice issued to the respondent for the reason that the show cause notice itself had been quashed. xxx 9. lt is not possible to accept the contention advanced by the learned authorized representative appearing for the department. Once the show cause notice had been quashed by the Delhi High Court, nothing remained to be ,adjudicated upon by the Commissioner, The Commissioner, therefore, committed no illegality in discharging the show cause notice. 10. The appeal is, accordingly, dismissed." 9. Ld. Counsel for the Appellant submits that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... authority and the CESTAT were incorrect in holding that the SCN having been quashed, none of the other demands would also be liable to be adjudicated. Clearly, the decision of the Division Bench of this Court is not to the said effect. In fact, it permitted the Department to proceed further strictly in accordance with the judgment and exclude the value of free materials. All the other demands which are raised, accordingly, deserve to be adjudicated on facts and in accordance with law. 14. The Respondent shall be given an opportunity, if required for responding to all the other demands raised in the SCN and if a personal hearing is sought, the same shall also be granted. It is made clear that this Court has not opined on any of the other i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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