Case Law Details
South India Shelters Private Limited Vs Commissioner of Central Excise (CESTAT Chennai)
CESTAT Chennai held that as per explanation to section 65(105)(zzzh) was added on 01/07/2010, builder/ developer/ promoter getting residential complex constructed for his customer and entering into individual agreements will be treated as deemed provider of construction of residential complex service. Accordingly, no liability of service tax will arise prior to 01/07/2010.
Facts- These are appeals filed by M/s. South India Shelters Pvt. Ltd., Chennai against the Order-in-Original Nos. 115 & 116/2012 dated 30.09.2012 passed by the Commissioner of Service Tax, Chennai.
The allegations against the assessee are that they were engaged in the construction of residential complexes, which became taxable on 16.06.2005, but they have taken registration with the Department only during June 2008. They have also not filed periodical ST-3 returns.
Conclusion- C.B.E.C. Circular No. 332/35/2006-TRU dated 01/08/2006 wherein it was clarified that where a builder/developer/promoter builds a residential complex engaging a contractor, the contractor shall be liable to pay service tax on the gross amount charged under construction of complex service and if no person is engaged by the builder/developer/promoter and who undertakes construction work on his own, the question of providing taxable service to any person by any other person does not arise and it would be in the nature of self service. The Tribunal held that it was only on 01/07/2010 that an explanation was added to section 65(105)(zzzh) where by a builder/developer/promoter who got residential complex constructed for his customer with whom he had individually entered into agreements, was to be treated as a deemed provider of construction of residential complex to his customers. Since the period where duty has been demanded in the impugned order is prior to 01/07/2010, no liability for paying tax either under ‘construction of complex service’ or ‘works contract’ would lie on the builder/developer/promoter during the period covered by the impugned order.
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