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2017 (4) TMI 704 - AT - Service TaxSite formation service - contract for production, Drilling & Associates Work in Underground Sindesar Khurd Mine - case of appellant is that impugned order failed to examine the limited scope of definition of site formation service and when several activities are undertaken, ultimately leading to mining then the gamut of activities cannot be taxed under site formation service - Held that: - the activities of services under consideration are to be treated as an activity auxiliary to the mining, their contract being indivisible contract. Such services are not taxable under the category of site formation clearance service, but they would be covered under the category of mining service, which has become taxable w.e.f. 01.06.2007 only - CESTAT, Delhi in the case of M/s.Aravali Construction Co. Pvt. Ltd. vs. CCE, Jaipur-II [2016 (8) TMI 675 - CESTAT NEW DELHI] has held that such services are not covered under the category of site formation and clearance, excavation and earth moving and demolition - service tax demand of ₹ 21,58,467/- under the category of site formation service cannot be sustained and is hereby dropped. Chargeability of the value of free supplies which include electricity and other items - appellant case is that it is only consideration paid which is taxable and not any material supplied for use during the course of rendition of service - Held that: - the issue is covered in favour of the appellant by the Larger Bench decision in the case of Bhayana Builders P. Ltd. [2013 (9) TMI 294 - CESTAT NEW DELHI (LB)], where it was held that free supplies made by the service receiver shall not be added to the value of the services - the demand of service tax of ₹ 44,66,679/- confirmed on the free supplies, which includes the value of electricity and other items is not sustainable and is hereby dropped. Appeal allowed - decided in favor of appellant.
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