Dix Engineering Project Services Pvt. Ltd. Vs Commissioner of Central Excise and Service Tax (CESTAT Bangalore)
SEZ Services Through Main Contractors Still Eligible for Tax Exemption, Rules CESTAT; CESTAT Deletes Service Tax Demand on SEZ Sub-Contract Works Due to Authorized SEZ Operations; No Time Limit for Availing Cenvat Credit Before September 2014; CESTAT Remands Cenvat Credit Issue After Rejecting Delay-Based Denial of Credit.
The appeal before CESTAT Bangalore arose from an Order-in-Original dated 01.05.2015 confirming multiple service tax demands against the appellant under “Works Contract Services” and “Supply of Tangible Goods Services.” The Commissioner had confirmed service tax demands of Rs.1.39 crore under Works Contract Services, Rs.4.56 lakh under Supply of Tangible Goods Services, Rs.5.31 crore relating to services rendered as a sub-contractor to SEZ units, and Rs.14.24 lakh relating to road construction services for MRPL. The order also denied Cenvat credit of Rs.71.97 lakh and imposed penalties.
The appellant contended that it had predominantly executed composite works contracts for setting up infrastructure in Special Economic Zones (SEZs) as a sub-contractor to principal contractors such as ANS Constructions Ltd., Vishal Structurals Pvt. Ltd., IVRCL Infrastructures and Projects Ltd., and SKE & C-KCT-JV. It was argued that the services were rendered within SEZ units and therefore qualified for exemption under Notification No. 4/2004-ST. The appellant also relied on certification issued by the Development Commissioner confirming that ONGC Mangalore Petrochemicals Pvt. Ltd. was an approved SEZ unit.
