TMI Blog2014 (7) TMI 1049X X X X Extracts X X X X X X X X Extracts X X X X ..... service tax demand on the free supply material supplied by M/s. Ashok Leyland Ltd. and service tax charged on account of free supply material in all the project executed by the appellant is included in the amount of ₹ 31,38,281/-, this point has to be examined by the adjudicating authority for which the same would have to be remanded. Building to be used by the Tanzania High Commission is not covered by the definition of ‘Commercial or Industrial Construction Service’ as given in Section 65(25b) - service tax demand of ₹ 31,58,281/- in respect of the value of free supply materials supplied by the customers and the service tax demand of ₹ 10,65,742/- in respect of the construction of Tanzania High Commission’s building ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ial service, no service tax has been paid in respect of the same. It was also found that the appellant had constructed a new building and staff quarters for Tanzania High Commission and had not paid any service tax in respect of the same by availing exemption notification no.16/2002-ST dated 2.8.2002 which was available to UNO or International Organizations. According to the department, this exemption was not available and the appellant were liable to pay service tax in respect of the same gross amount charged for this construction. 1.1 Accordingly, in view of the above, a show cause notice dated 14.8.2006 was issued to the appellant for demand of service tax amounting to ₹ 50,50,994/- in respect of a period 10.09.2004 to 16.06.200 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... volved in the present appeal and 22 other appeals took place on 11.6.2013 to 14.6.2013. The Larger Bench decided this issue vide judgement reported in 2013 (32) STR 49 (Tribunal-LB), wherein it was held that the value of free material supplied by the customers is not to be included in the gross amount charged for the purpose of the above mentioned exemption notification no.15/2004-ST and notification no.18/2005-ST.Accordingly, this appeal was listed for final hearing today for decision in accordance with the decision of the Larger Bench. 2. Heard both the sides. 3. Shri B.L. Narsimhan, Advocate, ld. Counsel for the appellant, pleaded that in this matter while the service tax demand of ₹ 31,58,281/- is in respect of the value of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e service tax demand of ₹ 8,26,971/- in respect of the construction for M/s. Ashok Leyland Ltd. is also not sustainable and in any case, the same needs to be requantified. 4. Shri Amresh Jain, ld. Departmental Representative defended the impugned order by reiterating the findings of the Commissioner and emphasized that the construction of building for Tanzania High Commission would attract service tax as civil or industrial construction service. 5. We have considered the submissions from both the sides and perused the records. 6. The service tax demand of ₹ 31,58,281/- without any dispute is in respect of the value of free supply material supplied by the customers. Since this issue stands decided in favour of the appell ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rimarily in, commerce or industry or work intended for commerce or industry, In view of the above, construction of building and staff quarters for Tanzania High Commission would not be covered by the commerce or industrial construction as an Embassy or High Commission building cannot be said to be meant for commerce or industry. 9. In view of the above discussion, the service tax demand of ₹ 31,58,281/- in respect of the value of free supply materials supplied by the customers and the service tax demand of ₹ 10,65,742/- in respect of the construction of Tanzania High Commission s building and their staff quarters is set aside. As regards the service tax demand of ₹ 8,26,971/- in respect of the construction for M/s. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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