Case Law Details
N. Rangasamy & Co. Vs Commissioner of Central Excise (CESTAT Chennai)
The CESTAT Chennai allowed the appeal involving the levy of service tax on construction of residential units for the Tamil Nadu Police during the period 1.4.2006 to 31.3.2009. The department had demanded service tax of Rs. 1,64,198, along with interest and penal-ties, under the category of Construction of Complex Service, and the demand had been confirmed by both the original authority and the Commissioner (Appeals). The Tribunal observed that the issue was no longer res inte-gra, as it had already been decided in favour of the appellants in several earlier decisions, including Bismi Engineering Contractors, Siva Engineering Company, S. Kadirvel, K. Elango Packiaraj, and Sima Engineering Constructions. Relying on the CESTAT Chennai decision dated 30.01.2019 in Bismi Engineering Contrac-tors, the Tribunal held that construction of police quarters falls within the exclusion category and is not liable to service tax, set aside the impugned or-der, and allowed the appeal with consequential benefits.
CESTAT Chennai held that construction of residential quarters for the Tamil Nadu Police is not exigible to service tax, following a series of earlier Tribunal decisions on the same issue. The Tribunal noted that its recent decision in Bismi Engineering Contractors had categorically held that construction of police quarters falls within the exclusion category. Find-ing no new grounds to depart from the settled legal position, it set aside the orders confirming service tax, interest, and penalties under Construction of Complex Service. The appeal was al-lowed, with consequential benefits in accordance with law.
FULL TEXT OF THE CESTAT CHENNAI ORDER
After hearing both sides, we find that the issue in dispute relates to demand of service tax liability on appellants in respect of construction of residential units for Tamil Nadu Police by the appellants during the period 1.4.2006 to 31.3.2009. Proceedings were initiated against the appellants alleging that service tax liability of Rs.1,64,198/- was required to be dis-charged on such activity along with interest under the category of construction of complex service. Original authority vide an order dt.28.5.2012 confirmed the demand with interest as proposed in the SCN as also imposed penalty under various provisions of law. In appeal vide impugned order dt. 14.12.2012, the Commissioner (Appeals) upheld the order of the original authority. Hence this appeal.
2. We find that the matter is no longer res integra and has been settled in favour of the appellants in a number of decisions for example —
1. Bismi Engineering Contractors and Other Vs CCE & ST Madurai 2013-TIOL-1583-CESTAT-MAD.
2. Siva Engineering Company Vs CCE & ST Coimbatore 2018 (8) TMI 1509 – CESTAT Chennai
3. S.Kadirvel Vs CCE & ST Tiruchirapalli 2013-TIOL-594-CESTAT-MAD.
4. K.Elango Packiaraj Vs CCE Madurai 2014-TIOL-742-CESTAT-MAD.
5. Sima Engineering Constructions & Others Vs CCE & ST Trichy 2013-TIOL-721-CESTAT-MAD.
3. We also note that in a very recent decision of CESTAT Chennai in the case of Bismi Engineering Contractors & Others Vs CGST & Central Excise, Madurai vide Final Order No.40195-40197/2019 dt. 30.01.2019 involving the very same issue, it has been categorically held that construction of such quarters for police personnel will fall un-der exclusion category and would not be exigible to service tad. We do not find any new grounds or reasons to deviate from this ratio. This being so, the impugned order to the con-trary cannot then sustain and requires to be set aside, which we hereby do. The appeal is allowed with consequential benefits, if any, as per law.
(dictated and pronounced in court)
Author Bio
