K.B. & Co. Vs Commissioner of GST & Central Excise (CESTAT Chennai)
CESTAT Chennai allowed the appeal concerning the levy of service tax under the category of ‘Construction of Complex Service’ for the period 01.04.2008 to 31.03.2010. The appellant had executed civil construction works for the Tsunami District Implementation Unit (TDIU) under the Rajiv Gandhi Rehabilitation Programme, involving the construction of 246 individual houses for Tsunami-affected people. The Tribunal observed that the Revenue had not disputed that the appellant constructed individual residential houses and not a residential complex. Relying on its earlier decision in Macro Marvel Projects Limited, the Tribunal held that construction of individual residential units does not fall within the definition of ‘Construction of Complex Service’ under Section 65(30a) of the Finance Act, 1994. Accordingly, the service tax demand was set aside, and the appeal was allowed with consequential benefits as per law.
CESTAT Chennai held that the construction of individual houses for Tsunami-affected people under the Rajiv Gandhi Rehabilitation Programme was not liable to service tax under ‘Construction of Complex Service’. The Tribunal noted that the appellant had constructed independent residential units, a fact not disputed by the Revenue, and relied on the decision in Macro Marvel Projects Limited, which held that construction of individual residential houses is outside the scope of taxable construction of residential complexes. Consequently, the Tribunal set aside the service tax demand and allowed the appeal with consequential benefits.
