Case Law Details
Shanti Construction Vs Commissioner of Central Excise & ST (CESTAT Ahmedabad)
The recent ruling by the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) Ahmedabad has settled the long-debated issue of service tax liability on the construction of residential complexes for non-commercial organizations. In the case of Shanti Construction vs. Commissioner of Central Excise & ST, the tribunal ruled in favor of the appellant, stating that service tax is not leviable for the construction of Residential Complexes meant for Gujarat State Police Housing Corporation Limited.
The core contention in this case revolved around whether the appellant was liable to pay service tax on the construction of residential complexes for the Gujarat State Police Housing Corporation. The appellant’s counsel argued that similar cases had been consistently decided in favor of the assessee, citing specific judgments as precedents. The judgments referenced highlighted that construction work undertaken for non-commercial or non-industrial entities falls under the exclusion clause of the definition of ‘Commercial or Industrial Construction Service,’ making it exempt from service tax.
In its analysis, the CESTAT Ahmedabad referred to the case of Riddhi Siddhi Construction, where the tribunal had already established a precedent in similar circumstances. The tribunal observed that the appellant’s construction work primarily served organizations like the Vadodara Municipal Seva Sadan, M.S. University, and the police department, which were not involved in commercial or industrial activities. As a result, the activity fell under the exemption clause, and the demand for service tax was deemed invalid.
FULL TEXT OF THE CESTAT AHMEDABAD ORDER
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