Custom, Excise & Service Tax Tribunal
Sai Construction Co vs Ghaziabad on 3 January, 2020
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
ALLAHABAD
REGIONAL BENCH - COURT NO.I
Service Tax Appeal No.52669 of 2015
(Arising out of Order-in-Original No.11/COMMR/CE/GZB/2014-15 dated
23/02/2015 passed by Commissioner, Central Excise & Service Tax,
Ghaziabad)
M/s Sai Construction Co. .....Appellant
(1468, Sector-5, Vasundhara, Ghaziabad)
VERSUS
Commissioner of
Central Excise, Ghazaibad .....Respondent
(C.G.O. Complex Kamla Nehru Nagar, Ghaziabad) WITH Service Tax Appeal No.52670 of 2015 (Arising out of Order-in-Original No.11/COMMR/CE/GZB/2014-15 dated 23/02/2015 passed by Commissioner, Central Excise & Service Tax, Ghaziabad) Shri Nitin Sharma, Partner .....Appellant (1468, Sector-5, Vasundhara, Ghaziabad) VERSUS Commissioner of Central Excise, Ghaziabad .....Respondent (C.G.O. Complex Kamla Nehru Nagar, Ghaziabad) APPEARANCE:
Ms. Stuti Saggi, Advocate for Appellant Shri Shiv Pratap Singh, Authorized Representative for Respondent CORAM :
Hon'ble Mrs. ARCHANA WADHWA, MEMBER (JUDICIAL) Hon'ble Mr. ANIL G. SHAKKARWAR, MEMBER (TECHNICAL) FINAL ORDER NO.70068-70069 / 2020 DATE OF HEARING: 03 January, 2020 DATE OF DECISION: 03 January, 2020
2 Service Tax Appeal No.52669, 52670 of 2015 ARCHANA WADHWA After rejecting the request for adjournment and after going through the memo of appeal, we note that the service tax stands confirmed against the appellant under three categories of services relatable to construction activities. In their memo of appeal, the appellants have raised the following points:-
"7.1 The contracts awarded by the Greater Noida Development Authority are basically for the general public and for non-commercial purposes. Therefore these contracts do not fall within the ambit of the statutory definition of Commercial or Industrial Construction Services.
7.2 Construction works at NSEZ, Noida have been done for NBCCL who are the authorized developer of Noida Special Economic Zone. Therefore the service tax is not leviable on the contract of construction in NSEZ. 7.3 Works relating to EWS Housing is not taxable as these are not activities of commerce on industry. The State Government through GNIDA provide civic amenities and securities to the economically weaker section people. Reliance has been placed on Circular No.80/10/2004-S.T., dated 17.09.2004. 7.4 If building or civil structure is used for discharge of the sovereign functions of the State, then the construction service is non-taxable since the service is not covered under the definition of commercial or industrial construction.
7.5 The work carried out relates to road which is excluded from the definition of Commercial or Industrial Construction. [Section 65 (25b) (d)]. 7.6 Street Lighting work, Supply of sub-station equipment and DG Set, Horticulture and landscaping, internal electrical work cannot be termed as taxable service under any clause of Section 65(105) of the Finance Act, 1994.
7.7 Construction of houses for GNIDA are not taxable under the category of "construction of Residential Complex Services in terms of Explanation inserted in the definition of the said Service by the Finance Act, 2010. As per the said Explanation, if entire sum is received from the buyers after grant of completion certificate, it shall not be a taxable service. In all the construction of residential houses, sale took place after the completion of building.
7.8 Further, these activities of construction of residences might be covered under the definition of Work Contract from 01.06.2007 and the activity does not fall within the scope of construction of residential complex service. 7.9 The work of the Site Grading, Road Work, Drain Work, Sewer Work and Water Supply does not relate or
3 Service Tax Appeal No.52669, 52670 of 2015 pertain to the construction of residential complex and it could not be changed to service tax under the category of construction of Residential Complex Service. 7.10 Internal/External electrification work of EWS houses at Greater Noida is not taxable service as the same does not result in emergence of an erected, installed and commission plant, machinery, equipment or structure or does not result in installation of an electrical or electronic device. Reliance has been placed on the Circular No.123/2010-TRU dated 24.05.2010. 7.11 There was no suppression of facts in view of the facts of the case, Board's Circulars and judicial pronouncements.
7.12 Penalty is not imposable as there was no mala fide intention to evade payment of Service Tax. 7.13 Penalty is not imposable on Shri Nitin Sharma, partner as his involvement in the alleged evasion has been alleged on presumption and assumption only and no specific charge has been leveled against him. 8.1 The Commissioner, however, without appreciating the various submissions made by the Appellants, has confirmed the demand of Service Tax amounting to Rs.3,92,01,805/- under the Proviso to Section 73(1) of the Finance Act alongwith interest under Section 75 of the Act. The Commissioner has imposed a penalty of Rs.3,92,01,805/- under Section 78 of the Act besides imposing penalty of Rs.200/- for every day under Section 77(1)(a) and under Section 77(1)(c) (i) (ii) and (iii) of the Finance Act, 1994.
8.2 The Commissioner has also imposed a penalty of Rs.10,000/- on Shri Nitin Sharma, Partner under Section 77(2) of the Finance Act, 1994."
2. It is seen that various activities of the appellant were required to be considered separately based upon the contracts. We further find that many of the issues stand decided by the precedent decision of the Tribunal. As each and every contract is required to be examined separately, we deem it fit to set aside the impugned order and remand the matter to Original Adjudicating Authority for fresh examination in the light of the precedent decisions of the Tribunal.
3. Needless to say that the appellants would be given an opportunity to put forth their defence and the appellants would not seek unnecessary adjournment and would 4 Service Tax Appeal No.52669, 52670 of 2015 cooperate with the Adjudicating Authority. Both the appeals are disposed of in above manner.
(Dictated and Pronounced in open Court) Sd/-
(Archana Wadhwa) Member (Judicial) Sd/-
(Anil G. Shakkarwar) Member (Technical) Nihal