Case Law Details
Voestalpine VAE VKN India Pvt. Ltd. Vs Commissioner of Central Excise (CESTAT Delhi)
Introduction: The recent case of Voestalpine VAE VKN India Pvt. Ltd. vs. Commissioner of Central Excise sheds light on the exemption of service tax related to the construction, commissioning, or installation of original works pertaining to the Delhi Metro project. The appellant, engaged in various industrial activities, filed an appeal seeking to overturn the Commissioner (Appeals) decision that set aside the earlier order allowing the refund claim. This article explores the case details, the relevant exemption notification, and the reasoning behind the decision.
Background: Voestalpine VAE GMBH received an order from Delhi Metro Railway Corporation for the supply of Gauge Turnouts (Railway Track items) on a ‘Delivery Duty Paid’ basis for its Jaipur and Faridabad metro projects. To fulfill the contract, V.V.G. awarded the machining of rails/crossing to Voestalpine VAE VKN India Pvt. Ltd. Initially, the appellant paid service tax, but later realized it was exempted under Notification No. 25/2012-ST .
Exemption Notification: The crucial part of the case revolves around Entry No. 14 of the exemption notification dated 20.06.2012. It states that services by way of construction, erection, commissioning, or installation of original works pertaining to an airport, port, railways, including monorail or metro, are exempt from service tax.
Refund Claim and Initial Decision: The appellant filed a refund claim after paying service tax of Rs. 3,24,326. The Assistant Commissioner, after careful examination, granted the refund, considering that the appellant supplied services crucial for the commissioning or installation of original works pertaining to the Delhi Metro.
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