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TMI Blog2025 (3) TMI 199X X X X Extracts X X X X X X X X Extracts X X X X ..... ercial or Industrial building and civil structure and 'Works Contract'. After several reminder, the department received documents from respondent / GCPL vide letter dated 8.1.2014 and 30.1.2014 for the Financial Year 2012-13 to Financial Year 2018-19. From scrutiny of these documents, it was observed that respondent has provided construction services to the following parties: (i) Indian Institute of Management, Noida (IIM, Noida) (ii) Consulting Engineer Association of India Limited (CEAI) (iii) Construction of residence for Mr. Manish Arora (iv) Civil work of residence of Mr. Anuj Dandone (v) Project at Sirifort Auditorium (vi) Belgravia - II project at Central Park-II, Sec-48, Gurgaon. (vii) AVA Court commercial complex at Malibu Towers Gurgaon (viii) School building for Birla Edutech Limited. 1.2 It was observed that the respondent had not paid service tax on the contracts mentioned at Serial No. (i) to (v) above. It was also observed that respondent had paid service tax under "Works Contract Service" (WCS) for the services provided for Execution of the Contracts mentioned above. 1.3 The department formed the opinion as follows: - (i) The respondent had charged servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s fall under any of the said categories. Hence the exemption is wrongly availed by the assessee respondent. (ii) The abatement under the composition scheme has also been wrongly availed as per notification no. 1/2006-ST dated 1.3.2006 for the reason that M/s Sweta Estates Pvt Ltd, the recipient of the respondent GCPL, had provided free of cost material to the assessee GCPL and restricted their effective control over the wastage of such material supplied. Also, the conditions of work contract composition scheme for payment of service tax rules 2007 were not complied with. (iii) The respondent GCPL received "Secured Advance" and "Advances from Customer" for execution of construction activities under heading "Current Liabilities" which were nothing but the taxable amount for which no tax were paid by the respondent. (iv) GCPL - respondent also incurred freight expenditure under the head "Freight and Cartage Expenses which were taxable under "Goods Transport Agency" but the tax was not paid by the appellant. 1.5 With these allegations, the service tax amounting to Rs. 15,90,60,547/- has been demanded from the respondents along with the interest and the penalties vide show cause not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is prayed to be set aside and the appeal is prayed to be allowed. 4. While rebutting the submissions, learned Counsels for the respondent-assessee have submitted that the SCN is vague as the demand of service tax proposed under three different categories of services for one single activity is not sustainable. 4.1 It is submitted that during the period prior to 01.07.2012, the charge of Service Tax was on various categories of taxable services referred to in Section 66 read with Section 65(105) of the Act with specific definitions thereof. It is settled position that if the services rendered by the assessee were appeared to be classifiable under more than one service, the Department should indicate the service under which entire activity rendered by the assessee need to be proposed. The SCN is vague as it does not provide the specific category of service under which the Department had proposed to classify the service rendered by Respondent during the period prior to 01.07.2012. 4.2 Learned Counsels relied upon following decisions: - * Central Registry of Securitisation, Asset Reconstruction and Security Interest of India (CERSAI) vs. Principal Commissioner CGST, South, Delhi, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8) TMI 629 - Rajasthan High Court; * URC Constructions Private Limited vs. Commissioner of CGST & Central Excise Salem, 2024-VIL-977-CESTATCHE- ST; * Aakriti Construction vs. Commissioner of Central Excise & Service Tax, Jaipur-I, 2019(6) TMI 866 - CESTAT New Delhi; * Modern Engineering Constructions vs. Commissioner of Central Excise, Tirunelveli, 2018(7) TMI 90 - CESTAT Chennai; 4.7 Similarly, the construction of stadium at Sri Fort Complex was not taxable as this stadium was to be used by the government for holding the commonwealth games and not for generating any profit. Stadium is otherwise a public facility used for the public recreation. Above all the demand on the said activities was subject matter of earlier show cause notice no. 199/2011-13 dated 17.7.2012 with respect to which it was held that no service tax was payable on construction of indoor sport stadium for conducting common wealth games i.e. noncommercial construction. 4.8 Learned counsels for appellant further submitted that the construction of private residences is outside the ambit of service tax hence the demand has rightly been set aside. The Hon'ble Supreme Court decision in case of Commissioner o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by not being in the nature of a commercial concerns. Therefore, construction activities undertaken by Respondent for CEAI were outside the purview of Construction of Complex Service. * DDA: In respect of Construction Services rendered to DDA, it has been observed that the activities were subject matter of earlier Show Cause Notice No. 199/AE/Gr.12/2012-13 dated 17.07.2012 and Show Cause Notice No. 256/Div-1/2012-13 dated 23.10.2012, which were adjudicated by a common Order-in-Original No. 61-62/GB/2013 dated 31.03.2013 holding that no service tax was payable on construction of Indoor Sports Stadium for conducting Common Wealth Games i.e., non-commercial construction. The said position is also clarified vide Circular No. 80/10/2004-S.T. dated 17.09.2004. Therefore, it has been held that there is no taxability on the construction activities undertaken for DDA. * Mr. Manish Arora and Mr. Anuj Dandone: In respect of Construction Services rendered to Mr. Manish Arora and Mr. Anuj Dandone, it has been observed that the construction was undertaken in respect of standalone 'single' residential building prior to 2012. Therefore, it has been held that the said services were outside the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is a commercial concern. It is the totality of its activity and the objective of its existence that determines the commercial nature of an institution as an 'entity' or a 'concern'. The principal activity of institutes like IITs or IIMs is to impart education without the objective of making profit. Therefore, these institutes cannot be called a commercial concern, even if on some of their activities (like holding campus interviews), they charge fee." 6.3 Thus, it is clear that IIMs are not-for-profit educational bodies and not in the nature of commercial concerns. It is submitted that services in relation to the construction of Noida campus for IIM, Lucknow were carried out for not-for-profit organization and constructed buildings were not primarily used for commerce or industry. Hence, the impugned services are not covered under 'Commercial or Industrial Construction Service' or 'Works Contract Service'. 6.4 We draw our support from the decision in the case of Banna Ram Choudhary Vs. Commissioner of Central Excise, Jaipur, 2017 (3) G.S.T.L. 338 (Tri.-Del.), wherein it was held that buildings used for educational purpose by recognized educational institutions cannot be categorize ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g profit. We draw our support from the decision in the case of Manisha Projects Pvt. Ltd. Vs. Commissioner of Central Excise & S.T., Ghaziabad reported as 2019 (3) TMI 448 - CESTAT Allahabad. In view of above discussions, it is held that construction services provided to IIM, DDA and CEAI are not taxable under 'Commercial or Industrial Construction Service', 'Construction of Complex Service' or 'Works Contract Service'. Thus, the impugned demand is not sustainable. 6.9 Coming to the construction activities pertaining to private residence of Shri Manish Arora and Shri Anuj Dandone were outside the ambit of Service Tax, it is held that the impugned services are not covered under sub-clause (a) to Section 65(25b) and sub-clause (ii)(b) of the Explanation to Section 65(zzzza) of the Act, therefore, not taxable under 'Commercial or Industrial Construction Service' or 'Works Contract Service'. 6.10 Further, as per sub-clause (a) of Section 65(30a) of the Act defined 'Construction of Complex Service' to mean construction of a new residential complex or a part thereof. Similarly, sub-clause (ii)(c) of the Explanation to Section 65(zzzza) of the Act defined 'Works Contract Service' to mea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n'ble Supreme Court in 2018 (10) GSTL 118 (SC). 6.13 The Service tax demand on 'advances' and 'miscellaneous income' shown in the balance sheet is with respect to the advances received during relevant period includes the amount is respect of the construction services provided to IIM, DDA, CEAI, Shri manish Arora and Shri Anuj Dandone which in itself outside the purview of service tax. Accordingly, said advances were also not liable to service tax. Also the amount declared as 'miscellaneous income' in the balance sheet during 2009-10 to 2011-12 was not pertaining to any taxable services. The said amount pertained to the unclaimed amount by the creditors and security deposits received by the respondent. The said facts are not in dispute in the present appeal. Thus, the impugned demand of service tax on 'miscellaneous income' is not sustainable. 6.14 With respect to service tax demand on 'freight and cartage expenses' that amount shown as 'Freight and Cartage Expenses' in the balance sheet consists of expenditure towards cartage, transportation and pumping charges, transportation charges, insurance and car policy, side expenses and freight charges. The amount shown as a 'cartage' is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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