Bajrang Lal Gupta Vs CCE- Delhi (CESTAT Chandigarh)
The CESTAT, Chandigarh in the case of Bajrang Lal Gupta v. The CCE Gurgaon [Service Tax Appeal No. 560 of 2011 dated June 5, 2023] held that contract involving both supply of material and labour is a ‘Works Contract Service’ which was not taxable prior to June 1, 2007.
Facts:
Bajrang Lal Gupta (“the Appellant”) is a proprietorship concern engaged in the business of construction of residential house on contractual basis. An inquiry was conducted by the Department calling certain details from the Appellant and alleging that the Appellant has not discharged service tax liability on construction services rendered by it to the Housing Board Haryana based on which a Show Cause Notice dated July 3, 2008 (“the SCN”) was issued proposing service tax demand of INR 11,24,458 after extending abatement benefit of 67%. The Appellant filed a detailed reply to the SCN to the Additional Commissioner which vide Order dated October 29, 2009 (“the Impugned Order”) confirmed the entire demand against the Appellant and further levied penalties under section 76,77 and 78 of the Finance Act, 1994.
Aggrieved by the order of the Additional Commissioner the Appellant filed an appeal before Ld. Commissioner (Appeals) which vide order dated December 27, 2010 rejected the appeal. Aggrieved thereby the Appellant filed an appeal before the CESTAT.
Issue:
Whether a contract involving supply of material and labour is a ‘Works Contract Service’ and whether the extended period of limitation is invokable?
Held:
The CESTAT Chandigarh in Service Tax Appeal No. 560 Of 2011 held as under:
