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2018 (9) TMI 1518 - AT - Service TaxClassification of services - construction of the residential apartments - appellant‟s claim is that the activity undertaken will fall under the category of construction of complex service under Section 65 (105) (zzzh) readwith Section 65 (30a) - whether classified under Works contract service or under construction of complex service? Held that:- The key to the decision is in the fact that the construction activity has been carried out by the appellant on the land which is acquired and owned by the appellant. The appellant has carried out design, planning, development of their own land and carried out the construction and transferred the completed flats to the buyers. To our minds, the activities undertaken do not merit classification under works contract services. The activity will be covered under works contract service only when the contract is entered into by the appellant only for construction of residential complex on land owned by someone else. The CBEC Circular dated 29/01/2009 bring out the position clearly that in the activity undertaken by the appellant in building a residential complex, there will be no liability to pay service tax under the category of construction of complex service. The position changed only w.e.f. 01/07/2010 when an explanation was added to sub-Section (zzzh), making such activity to be a deemed service - Thus the activity of the appellant, covered by the construction of complex service is liable to be set aside for the period upto 01/07/2010. Period from 01/07/2010 to March 2011 - Held that:- The Adjudicating Authority has upheld the payment of service tax under the category of works contract services, but as discussed above, the activity is liable for payment of service tax only under the category of construction of complex service. The appellant has also submitted during the course of argument that they have discharged the service tax for the period w.e.f. 01/07/2010 after availing applicable abatements. The Adjudicating Authority is directed to verify such claim. Subject to such verification, the demand for service tax under works contract service raised in the show cause notice is set aside for the period 01/07/2010 to March 2011 - matter on remand. The issue of time bar need not be discussed since the appeal itself is being allowed on merit. Appeal allowed in part and part matter on remand.
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