Case Law Details
R C Patel Vs Commissioner of Central Excise & ST (CESTAT Ahmedabad)
CESTAT Ahmedabad held that as work orders involves both supply of material as well as service, the same is classifiable under works contract service and not under Commercial and Industrial Construction Service.
Facts- The appellant are engaged in providing services such as laying, jointing and testing pipes for water supply/drainage/effluent pipeline/ MLD water scheme, etc. provided to Gujarat Industrial Development Corporation. It has been the contention of the department that the activity undertaken by the appellant i.e. of laying down of the pipes for water supply, drainage or affluent pipeline for the GIDC falls under the category of the Commercial and Industrial Construction service as defined u/s. 65(25b) of the Finance Act, 1994. It has also been contended by the department that the appellant had availed the abatement under Notification No.1/2006-CE dated 01.03.2006 without fulfilling the necessary conditions for availing the benefit of such notification for the period 2007-08 to 2010-11 and thereby the appellants have failed to pay service tax properly to the Government exchequer which resulted in short payment of service tax amounting to Rs. 3,27,05,009/-.
Conclusion- We find that the work orders involved supply of pipes for water supply, drainage as well as laying the same as per the engineering drawings. Thus, it is accepted that that the activity undertaken by the appellant involves both supply of material as well as service. Thus, we are convinced that the activity undertaken by the appellant is properly classifiable under Works Contract Service.
We take note of the fact that the assessee has been regularly filing their service tax returns under the Works Contract Service as well as they have entered into a correspondence with the department during August 2008 upto 20th October 2008 and therefore, we are of the view that no element of fraud, collusion or wilful mis-statement or suppression of facts are involved therefore, we also are of the view that demand is barred by limitation and deserves to be set aside on limitation ground also.
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