N P Patel & Co Vs C.S.T.-Service Tax (CESTAT Ahmedabad)
CESTAT Ahmedabad held that service provided to Gujarat Energy Transmission Corporation Ltd. are exempted from the payment of service tax in terms of Notification No. 45/2010–ST dated 20.07.2010.
Facts- It is alleged that the appellant had provided the work/ services covered under the taxable services of works contract service, Commercial & Industrial Construction Services, Construction of Complex Service and the Site formation and Clearance, Excavation and Earth Moving and Demolition Service, not paid the service tax.
After detail investigation show cause notice dated 18.03.20 11 was issued to the Appellant proposing service tax demand and to imposed penalty under Section 76, 77 and 78 of the Finance Act, 1944. Being aggrieved by the impugned order of Learned Commissioner, the appellant has filed the present appeal.
Conclusion- As regard the service provided to Gujarat Energy Transmission Corporation Ltd. we find that such services are exempted from payment of service tax in terms of Notification No. 45/2010–ST dated 20.07.2010. The decisions relied upon by the Appellant in this context also support the claim of appellant, however we do not find any finding on this aspect in impugned order.
The Notification No. 17/2005–S.T. dated 07.06.2005 exempts Site Formation and clearance, excavation and demolition and such other similar activities carried out in the course of construction of roads, Airports, Railways, terminal, bridges, tunnels, dams, ports or other ports etc. from the levy of service tax.
FULL TEXT OF THE CESTAT AHMEDABAD ORDER
This appeal is directed against order-in-original No. STC/19/COMMR/AHD/2012 dated 29.03.2012 passed by the Commissioner of Service Tax, Ahmedabad.
2. The relevant facts that arise for consideration are that the appellant are engaged in the business of infrastructural and construction business. Intelligence was gathered by the revenue authorities and search was conducted at the premises of the Appellant. Investigation revealed that appellant had engaged in execution of following project:
(i) Providing and laying of sewerage /drainage pipelines networks on behalf of Ahmedabad Municipal Corporation and Ahmedabad Urban Development Authority;
(ii) Construction of building such a control room, structure and equipments, road, cable trench etc on behalf of Gujrat Energy Transmission Corporation Ltd;
(iii) Construction of a Transport Terminal Comprising of shops over the land provided by Gujarat State Road Transport Corporation, under Build, Transfer and Lease (BTL) Scheme;
(iv) Construction of Residential Houses for Gujarat State Police Housing Corporation Ltd., Gandhinagar;
(v) Construction of Boy’s Hostel Building for Navsari Agricultural University;
(vi) General earth filling for the embankment construction behind retaining wall in Sabarmati River, Ahmedabad on behalf of Sabarmati River Front Development Corporation Ltd.
Though appellant had provided the above work/ services covered under the taxable services of works contract service, Commercial & Industrial Construction Services, Construction of Complex Service and the Site formation and Clearance, Excavation and Earth Moving and Demolition Service, not paid the service tax.
2.1 After detail investigation show cause notice dated 18.03.20 11 was issued to the Appellant proposing service tax demand and to imposed penalty under Section 76, 77 and 78 of the Finance Act, 1944. Thereafter, after following the due process, the Learned Commissioner, passed the impugned order as under:
(i) Confirm the demand of Service tax of Rs. 2,72,71,371/- under the category of “Works Contract Service” under Section 73(2) of the Finance Act, 1994.
(ii) Confirm the demand of Service tax of Rs. 3,63,033/- under the category of “Commercial or Industrial Construction Services “ under section 73(2) of the Finance Act, 1994.
(iii) Confirm the demand of Service tax of Rs. 11,47,392/- under the category of “Construction of Complex Service” under Section 73(2) of the Finance Act, 1994.
(iv) Confirm the demand of Service tax of Rs. 52,75,110/- under the category of “Site Formation and Clearance, Excavation, earth moving & demolition service” under Section 73(2) of the Finance Act 1994.
(v) Order to recover interest on above confirmed demand
(vi) Order for appropriation of the service tax amount of Rs. 20,27,734/- already paid against the confirmed demand.
(vii) Impose penalty under Section 76 of the Finance Act.
(viii) Impose penalty of Rs. 3,40,56,906/- under Section 78 of the Finance Act, 1994
(ix) Impose penalty under 77(1)(a) of the Act.
Aggrieved by the impugned order of Learned Commissioner, the appellant has filed the present appeal.
3. Shri Jigar Shah, Learned Counsel With Shri Rahul Patel, Chartered Accountant appearing on behalf of appellant submits that demand of service tax of Rs. 16,09,803/- is confirmed under the taxable category of works contract service for construction work carried out for M/s Gujarat Energy Transmission Co. Ltd. is not sustainable. The said work was carried out for transmission of electricity and by virtue of Notification No. 45/2010-ST dated 20.07.2010 any services provided in relation to distribution or transmission of electricity is not taxable. He placed reliance on following judgments:
