MVL Ltd Vs Commissioner of Central Goods And Service Tax (CESTAT Delhi)
Summary: The Customs, Excise & Service Tax Appellate Tribunal, New Delhi Principal Bench, Court No. IV, disposed of four connected appeals arising from common Order-in-Original No. 99/16-17 dated 17.02.2017. In accordance with the first-case rule, the principal matter is the appeal of M/s. MVL Ltd. The connected appellants were Shri Satinder Prasad, Shri Rakesh Gupta and Shri Prem Adip Rishi.
M/s. MVL Ltd was engaged as a builder/developer in construction of residential flats and was registered for “Construction of Complex Services”. Revenue alleged that, apart from consideration for flats, the appellant collected external development charges, parking charges, power backup charges, preferential location charges, interest-free maintenance security, meter charges and sewer treatment plant charges. A service tax liability of Rs. 12,29,16,928/- was alleged for August 2010 to March 2015. The appellant had deposited Rs. 1,41,57,357/- after an audit objection, but Revenue alleged that certain additional amounts, including car parking charges, had not been included in taxable value. The appellant had also not timely filed service tax returns for October 2012 to September 2014 or paid the applicable late fee.
The appellant submitted that the dispute concerned three residential complexes in Bhiwadi, Rajasthan and that agreements with buyers provided for construction-linked payments, while title was ultimately transferred through sale deeds. It relied upon the decision of the Delhi High Court in Suresh Kumar Bansal V/s Union of India, contending that the absence of a mechanism for determining the service component in a composite contract rendered the levy unsustainable. It further argued that the agreements involved supply of services and materials and therefore fell within works contract service rather than construction of complex service, relying upon Larsen & Toubro Ltd.. Other submissions concerned pre-July 2010 services, cancelled flats, waived sums, flats sold after completion certificates, abatement, CENVAT credit, the composition scheme and limitation.
