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2018 (7) TMI 25 - AT - Service TaxWorks Contract - Benefit of abatement towards providing the materials used in carrying out the contracted activities - management, maintenance and repair of traffic signals poles/lights - installation/commissioning of surveillance cameras at various road inter-sections - Held that:- From the nature of activity carried out by the assessees for the Rajasthan Government, it is seen that contracts were in the form of turnkey contracts which involved supply of the materials necessary for carrying out the work of installation and maintenance of surveillance cameras, street lights etc. Consequently, such contracts are to be considered as works contracts defined under Section 65 (105) (zzzza) - reliance placed in the case of COMMISSIONER, CENTRAL EXCISE & CUSTOMS VERSUS M/S LARSEN & TOUBRO LTD. AND OTHERS [2015 (8) TMI 749 - SUPREME COURT], where it was held that such composite contracts cannot be charged to service tax under any other category prior to the introduction of WCS. - the demand for service tax for the period prior to 01/06/2007 set aside. Payment of service tax w.e.f. 01/06/2007 under the category of WCS - Composition Scheme - denial on the ground that the assessees have failed to satisfy to Rule 3 (3) of the relevant Composition Rules which require the assessees to exercise the option for payment of service tax under these composition rules for each contract - Held that:- Such requirement is only procedural and cannot come in the way of extending the benefit of composition scheme since the assessees have exercised such option, although belatedly. Penalties - Held that:- The levy of service tax under the category of works contract service was the subject matter of substantial litigation which got settled only with the decision of Hon’ble Supreme Court in the case of Larsen & Toubro Ltd. [2015 (8) TMI 749 - SUPREME COURT] - the appellants, who have discharged the service tax liability in full even though part of the same was discharged after issue of show cause notice, will be entitled to the benefit of waiver of penalty under Section 80 - penalty set aside. Appeal allowed - decided in favor of appellant.
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