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Case Law Details

Case Name : Paramount Infraventures Pvt Ltd Vs Commissioner of Service Tax (CESTAT Delhi)
Appeal Number : Service Tax Appeal No. 50157 of 2017 [DB]
Date of Judgement/Order : 07/06/2024
Related Assessment Year :
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Paramount Infraventures Pvt Ltd Vs Commissioner of Service Tax (CESTAT Delhi)

In a significant ruling, the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) Delhi has clarified the service tax liabilities for private race tracks. In the case of Paramount Infraventures Pvt Ltd vs Commissioner of Service Tax, the tribunal held that race tracks not intended for public use do not qualify for service tax exemption. This judgment has important implications for contractors and service providers involved in specialized construction projects.

The case began when the officers of the Directorate General of Central Excise Intelligence (DGCEI), Delhi Zonal Unit, initiated an investigation into Paramount Infraventures Pvt Ltd (hereinafter referred to as the Contractor). The investigation revealed that the contractor had constructed an earthen embankment for the Formula One (F-1) race track at the Buddh International Circuit in Greater Noida but had not paid the appropriate service tax.

The core of the dispute revolved around whether the services provided by the contractor qualified for exemption under Notification No. 17/2005-ST dated 07.06.2005. The contractor argued that their work on the race track was akin to constructing a road, which should be exempt from service tax under the specified notification. However, the service tax department contested this claim, stating that the exemption applied only to roads meant for public use, not private race tracks.

The CESTAT Delhi examined several contracts related to the project:

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July 2024