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2018 (8) TMI 627 - AT - Service TaxWhether differential service tax liability needs to be discharged by the appellant herein for the period April, 2007 and May, 2007 without extending benefit of abatement of N/N. 01/2006 and for the subsequent period whether ash dyke constructed by the appellant would fall under the works contract services or site formation and clearance services? Held that:- The entire contract which has been entered into by the appellant with Lanco Infratech Ltd is nothing but a works contract and will remain so. If it is so, the law settled by the Apex Court in the case of Larsen and Toubro Ltd [2015 (8) TMI 749 - SUPREME COURT] in respect of such kind of works contract is that they remain works contract pre and post 01.06.2007, would cover the issue in favour of appellant and demand of differential service tax liability for the period April and May, 2007 and after June, 2007 a works contract. The adjudicating authority in the case in hand has misdirected his finding to record that construction of ash dyke cannot be considered as works contract and benefit of the Works Contract (composition scheme for payment of Service Tax) Rules, 2007 cannot be extended. The findings recorded by the adjudicating authority on the confirmation of the demand of differential duty under this category are correct and does not require any interference - The demand of ₹ 72,08,553/- along with interest is upheld. Penalty - Held that:- The issue of whether the activity would fall under the category of construction of road or otherwise is an issue of interpretation of Notification No. 17/2005-ST. - the appellant could have entertained a bona fide belief that they are eligible for the benefit of Notification No.17/2005-ST. - Penalties set aside. Appeal disposed off.
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