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TMI Blog2025 (4) TMI 1067X X X X Extracts X X X X X X X X Extracts X X X X ..... he Act. 2. Succinctly, the facts are that the appellants are registered with the Department as service providers of Commercial or Industrial Construction Services and Construction of complex services and is registered with the department and have also filed periodical ST-3 returns. During verification of their accounts, it was observed that they had undertaken construction services for various educational institutions. The details of such construction services undertaken by them were furnished by the appellants vide letter dated 09.01.2014. The appellants relied on CBEC Circular dated 17.09.2004 and contended that no Service Tax was payable them and claimed exemption from such works contract service rendered, in their ST-3 returns for the period from October 2008 to June 2012. However, it appeared to the Department that the above circular will not apply to appellant since the institutions run by the service recipient provide educational/other services only by charging applicable fees and no proof had been provided to the effect that they were not making income /profit out of its activities. In addition to the above, it appeared that the above circular was withdrawn by CBEC's Circu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is submission that while the nature of the work undertaken by the appellant is not denied the Department has not adduced any evidence to prove that it is for advertising whereas the evidence adduced by the appellant would indicate that it is construction of center median on the National Highway and Section 65 (105) (zzzza) excludes works contracts for roads from the levy. It is his submission that service tax and cess of Rs.53,283/- was demanded for the period 2011-12 for construction of Govt Buildings, which are non-commercial and Section 65 (105) (zzzza) excludes such buildings from the levy. 4. He further submits that the period involved is April 2008 to June 2012. SCN was issued on 21.4.2014 and the entire period is beyond the normal period one year/18 months. It is his submission that during the relevant period. classification of construction services and availing exemptions are interpretational issues, which were settled by various forums in favour of assesses and further the details of services claimed as exempted were declared in the periodical ST-3 returns and they have filed VAT returns also. Under such circumstances, extended period cannot be invoked. Reliance was place ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ater proofing, lift and escalator, fire escape staircases or elevators; or (b) construction of a new building or a civil structure or a part thereof, or of a pipeline or conduit, primarily for the purposes of commerce or industry; or (c) construction of a new residential complex or a part thereof; or (d) completion and finishing services, repair, alteration, renovation or restoration of, or similar services, in relation to (b) and (c); or (e) turnkey projects including engineering, procurement and construction or commissioning (EPC) projects; 8. As regards the first issue, we find that the following aspects are not in dispute: 1) That the appellants have undertaken construction services for various educational institutions, that were being run by Charitable Trusts. 2) The appellants have claimed that they are out of the ambit of such works contract service rendered in their ST-3 returns periodically filed. 3) The SCN has asked the appellant to show cause as to why the services rendered by them with reference to construction of new building to educational institutions should not be assessed to tax under Section 65(105)(zzza) of the Act invoking the extended period of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rein to secure the benefits, there are no such requirements when the appellant contests taxability, on a belief stemming from the contents of Board Circular. On issues of taxability, to bring the prospective assessee within the ambit of the levy, the burden of proof is always on the revenue and that cannot be shifted onto the assessee. It is necessary to note the fundamental distinction between burden of proof and onus of proof. The burden of proof lies with the person who has to prove a fact and it never shifts, but the onus of proof shifts. Onus means the duty of adducing evidence. Thus, if the Revenue seeks to tax the assessee under " Works Contract Service" and particularly under clause (ii)(b) of the explanation, then the burden of proof is on the Revenue to show at first that the construction which the assessee has undertaken is of a building or civil structure or part thereof, primarily for the purposes of commerce or industry. Once the Revenue is able to discharge its burden of proof, then if the assessee is contesting the taxability, the onus shifts on to the assessee to prove that it is not so. In the instant case when the appellant is under a belief that it is not within ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... service tax would depend primarily upon whether the building or civil structure is 'used, or to be used' for commerce or industry. The information about this has to be gathered from the approved plan of the building or civil construction. Such constructions which are for the use of organizations or institutions being established solely for educational, religious, charitable, health, sanitation or philanthropic purposes and not for the purposes of profit are not taxable, being non-commercial in nature. Generally, government buildings or civil constructions are used for residential, office purposes or for providing civic amenities. Thus, normally government constructions would not be taxable. However, if such constructions are for commercial purposes like local government bodies getting shops constructed for letting them out, such activity would be commercial and builders would be subjected to service tax. 13.3 In case of multi-purpose buildings such as residential-cum- commercial construction, tax would be leviable in case such immovable property is treated as a commercial property under the local/municipal laws. 13.4 The definition of service specifically excludes construction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Supply & Sewerage Board case, wherein on the issue of whether charitable institutions are industries, while interpreting provisions of Industrial Disputes Act, 1947, it was held that noble objectives, pious purposes, spiritual foundation and developmental projects are no reason not to implicate these institutions as industries. However, we find that in the Judgement of the Honourable Supreme Court rendered in the case of T.M.A Pai Foundation & Others v. State of Karnataka & Others, (2002) 8 SCC 481, the Honourable Apex Court while sitting as a bench of eleven judges, has in para 29 thereof, while noting the reliance placed on the aforesaid Bangalore Water Supply and Sewerage Board v. A. Rajappa, (1978) 2 SCC 213 wherein it was held that educational institutions would come within the expression "industry" in the Industrial Disputes Act, has cited with approval the distinguishing of the judgement made by Jeevan Reddy J., in the case of Unni Krishnan, J.P v. State of A.P (1993) 1 SCC 645, observing as under : " But the applicability of this decision was distinguished by Jeevan Reddy J., observing (at SCCN p.753, para 200) that "we do not think the said observation (that education i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aining the scope of the changes brought about consequent to the enactment of the Finance (No. 2) Bill, 2004 on 10-09-2004 and thus primarily providing instructions/guidance to the officers. It is also pertinent that the Board's circular continued to be in existence as noted by this Tribunal in the decision in R.R. Thulasi India Pvt Ltd, that is cited infra. 17. We find that even otherwise, the issue of whether the works contract services of construction rendered to education institutions can be treated as construction of a new building or civil structure or a part thereof, primarily for the purposes of commerce or industry, has been dealt with by this Tribunal on an earlier occasion in the Service Tax Appeal No.41763/2015 in the case of M/s. R.R. Thulasi India Pvt Ltd v The Commissioner of CGST & Central Excise, Salem Commissionerate, vide Final Order No.40703/2024 dated 13.06.2024, since reported in 2024 (7) TMI 1067- CESTAT Chennai. The relevant portions of the order are reproduced below: "7. The issue to be considered is whether the appellant is liable to pay service tax under "Works Contract Service" for the period 01.10.2008 to 30.06.2012 for construction of educational ins ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Board specifically clarified that construction services provided for construction of educational institutions are exempted from levy of service tax we find no reason to hold that these constructions are commercial in nature. 11. It also requires to be stated that the Coimbatore Builders and Contractors Association had addressed to the Chief Commissioner of Central Excise, Coimbatore vide letter dt. 19.06.2013 requesting for clarifications with regard to various construction services. One of the clarifications raised in the said letter was whether the Circular No.80/10/2004-ST dt. 17.09.2004 is to be treated as withdrawn or not. The said letter by the Coimbatore Builders and Contractors Association as well as the reply by the Coimbatore Commissionerate is as under:" 20. After reproducing the said letter by the Coimbatore Builders and Contractors Association as well as the reply by the Coimbatore Commissionerate, this Tribunal then finds in para 12 as under: "12. From the above, it can be seen that the department itself has taken the view that the circular dt. 17.09.2004 is still in force and that the construction provided for educational institutions are exempted from levy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the service tax is sought to be levied on the ground that such service is rendered to an Advertising Agency who in turn is engaged in providing advertising which is done in pure commercial considerations. We are unable to concur with the said reasoning of the Adjudicating Authority. The definition of works contract service, while excluding works contract in respect of roads, does not contain any stipulations as to the identity of the service recipient, much less the nature of the service recipient's business considerations, and the said contention of the Adjudicating Authority is extraneous in determining the appellant's entitlement to the exclusion from the ambit of the definition as claimed. 24. We note that the works contract excluded in the definition is predicated on the identity of the infrastructure that is specified therein, namely, roads, airports, railways, transport terminals, bridges, tunnels and dams which are nothing but the salient physical infrastructural markers of a nation's or region's economic foundation. When the work carried out by the appellant is indisputably conceded as that of constructing center-medians on Highway No.67 (Trichy Road), and since 'center ..... 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