SERVICE TAX APPEAL NO. 10525 of 2013
SERVICE TAX Miscellaneous (ORS) Application No. 10415 of 2022
[Arising out of Order-in-Original/Appeal No 7-2013-STC-SKS-COMMR-A-AHD dated
17.01.2013 passed by Commissioner of Service Tax-AHMEDABAD]
N J Devani Builders Pvt Ltd
VERSUS
C.S.T.-Service Tax – Ahmedabad
APPEARANCE:
Shri Amal Dave, Advocate appeared for the Appellant
Shri Prakash Kumar Singh, Superintendent (AR) for the Respondent
CORAM: HON’BLE MEMBER (JUDICIAL), MR. RAMESH NAIR
HON’BLE MEMBER (TECHNICAL), MR. RAJU
FINAL ORDER NO. A/10262 / 2023
DATE OF HEARING: 23.01.2023
DATE OF DECISION: 07.02.2023
RAMESH NAIR
In the present case following issues are involved:
(A) Whether in the facts and circumstance of this case appellant service
falls under commercial construction provided in respect of
construction of a building belongs to university.
(B) Whether in the facts and circumstances of this case the demand of
Rs. 52,228/- under the category of commercial or Industrial
construction services related to supply or furniture is justified or
otherwise.
(C) Whether the work of strengthening of culverts on the road is liable to
Service Tax under commercial or Industrial construction service.
(D) Whether the demand for extended period is invokable.
Shri Amal Dave, Learned Counsel appearing on behalf of the
appellant submits that the construction of a building is in respect of
educational university which is under a trust. Therefore, the same cannot
be treated as commercial building and cannot be taxed under commercial
construction service. He alternatively, by way of miscellaneous application
submits that the construction was provided along with material and state
tax i.e VAT was paid on such projects. Therefore, the service if at all taxable
is covered by “works contract Service”. Since the period involved is 2005-
06 and 2006-07. The “works contract service” is not taxable till
01.06.2007. In this regard he referred to the contract between the
appellant and GERMI (service recipient). He placed reliance upon the
following judgments:
Commr. Of Service Tax-Vll Vs. M/s. S.M. Sai Construction-2016 (42)
STR 716 (Tri.-Mumbai)
M/s. Vij Construciton Pvt. Ltd. V/s. Commr. Of Central Ex., New
Delhi- 2018 (11) GSTL 169 (Tri.- Delhi)
M/s. KMV Projects Ltd.- V/s. Commr. Of Ce. Ex. & St, Hyderabad.-
2019 (27) GSTL 388 (Tri.- Hyderabad)
M/s. Lanco Infratech Ltd. V/s. CC, EC & ST, Hyderabad.- 2015 (38)
STR 709 (Tri.- LB)
Shri Prakash Kumar Singh, Learned Superintendent (Authorized
Representative) appearing on behalf of the revenue reiterates the finding
of the impugned order.
We have carefully considered the submissions made by both the
sides and perused the records. We find that as regard the service tax
demand on construction service to GERMI apart from the ground that the
same is not commercial construction being an education trust, the
appellant also made an additional ground by way of miscellaneous
application that the entire service falls under works contract service.
However, this ground was taken first time before this Tribunal. Therefore,
the lower authorities had no occasion to deal with this issue. In this
position, we are of the view that the issue in respect of construction of
GERMI… needs to be re considered from the angle of work contract service.
As regard the issue of service tax on supply of furniture, we find that the
Lower Authority have held the said activity as commercial construction and
demanded tax accordingly. We are of the view that mere supply of
readymade furniture cannot be classified as commercial construction
service supply of furniture is nothing but sale of furniture. Hence the same
cannot be classified as taxable services. Accordingly the service tax
demand of Rs.52,228/- is not sustainable and the same is set aside. As
regard the issue relates to demand of Service tax of Rs. 34,483/- on the
activity of strengthening of culverts on roads, we find that this service is
directly connected to the road and any work related to the public road is
excluded from the service of commercial or industrial construction. For this
reason the same cannot be taxed under commercial or industrial
construction service. Hence, We set aside the demand of Rs. 34,483/-
As per our above discussion and finding appeal relates to demand ot Rs.
52,228/- of supply on furniture and Rs. 34,483/- relates to strengthening
of culverts on road is allowed. Appeal relates to the issue of construction
of building for GERMI is allowed by way of remand to the Adjudicating
Authority for passing a fresh order on all the issues.
The appeal is partly allowed and partly remanded in the above
terms. MA also stands disposed of.
(Pronounced in the open Court on 07.02.2023)
(RAMESH NAIR)
MEMBER (JUDICIAL)
(RAJU)
MEMBER (TECHNICAL)
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