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2022 (6) TMI 303 - CESTAT AHMEDABADWorks Contract service - Continuous Contracts - Benefit of composite scheme for ongoing projects for which service tax paid before 01.06.2017 under Commercial or Industrial Construction Service/ Construction of Complex Service - levy of service tax alongwith interest and penalties - HELD THAT:- From Circular No. 128/10/2010-S.T., dated 24-8-2010, in respect of such continuous contracts, it is clear that for the ongoing contracts which were classified where service tax has been paid in the respective specified services before being classifiable under the ‘works contract service’, the benefit of composition scheme would not be applicable - In the instant case it is admitted facts that the appellant has paid service tax on ongoing projects under Commercial or Industrial Construction Services and Construction of complex service. Therefore on these 34 ongoing projects the option to pay service tax under the Works Contract (Composition Scheme for Payment of Service tax) Rule, 2007 is not available to the Appellant. In the case of NAGARJUNA CONSTRUCTION COMPANY LTD. VERSUS GOVERNMENT OF INDIA [2010 (6) TMI 91 - ANDHRA PRADESH HIGH COURT] which involved identical issue. The Hon’ble High Court, while deciding the applicability of Rule 3(3) of the Composition Scheme discussed the case of ongoing works contracts which were earlier being classified under the ‘Residential Complex Services’. It is pertinent to mention that in the appellant’s own case the Hon’ble Gujarat High Court in JMC PROJECTS (INDIA) LTD. VERSUS COMMISSIONER OF SERVICE TAX [2014 (5) TMI 106 - GUJARAT HIGH COURT] categorically held that in respect of ongoing projects as on 01.06.2007 if any payment of service tax was made under the respective taxable service head before the said date, qua such contract, composition scheme was not available. Thus, for the ongoing projects as on 1-6-2007, if any payment of service tax was made under the respective taxable services, composition scheme would not be available for the same. Penalties under section 76 and 78 of Finance Act - HELD THAT:- As per the settled legal position penalty under section 76 is not tenable when penalty under section 78 is imposed. This issue no longer res integra. Thus, appellant is not liable for penalty under section 76. Accordingly simultaneous penalty imposed under section 76 is set aside. Thus, the demand of service tax confirmed by the adjudicating authority is upheld along with penalty imposed under Section 76/78 and interest under Section 75 - simultaneous penalty imposed under Section 76 is set aside - appeal allowed in part.
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