Case Law Details
Vishwanath Projects Limited Vs Commissioner of Service Tax (CESTAT Hyderabad)
Evidently, from a bare perusal of the contract, it is evident that the purpose of the contract is for providing floodlighting along the Indo Bangladesh Border in the State of Tripura and NOT for transmission and distribution of electricity. Merely because electricity is used in the flood lighting, it does not a project for transmission and distribution of electricity. If this logic is accepted, there could hardly be any service which is rendered by any service provider without use of electricity in some form and for this purpose being connected to the power grid. It could be as simple as connecting computers, running the air conditioners, providing lighting or fans all of which are essential for rendition of services. Merely because they are connected to a grid, the service does not become transmission and distribution of electricity.
FULL TEXT OF THE CESTAT JUDGEMENT
1. This appeal is filed against Order-in-Original No. HYD-EXCUS-003-COM-06- 14-15, dated 29.04.2014. The facts of the case are that the appellant herein is registered with Central Excise Department as a Service Tax provider under the service categories of ‘Works Contract Service’, ‘Goods Transport Agency’ and Erection and Commissioning Services’. During the verification of their accounts by Revenue it was found that they had undertaken the works of execution of some works on which they have not discharged the service tax appropriately. It was also observed that the appellant had received advances from their customers and had not discharged the service tax on taxguru.in such advances. In terms of Section 65(105), taxable service includes the services ‘to be provided’ and hence the service tax had to be paid on the advances also. Thirdly, it was also found that the appellant had paid some amounts towards “goods transport agency” service on which they were supposed to discharge the service tax liability under reverse charge mechanism which they have not done. Accordingly, a show cause notice was issued calling upon the appellants to explain:-
(a) Why an amount of Rs. 1,07,12,000/- should not be demanded as Service Tax from them under “Erection, Commissioning or Installation Services”.
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