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2019 (3) TMI 1232 - AT - Service TaxLiability of service tax with interest - construction services provided to L&T for On-shore Terminal Project - Held that:- Although appellants therein had urged various contentions on facts and in law seeking to distinguish the ratio of the Afcons Infrastructure (supra) the Tribunal in para-15 has made it clear that they were not dealing with the issue as the matter is being remanded. In the circumstances, there cannot be any proposition that Tribunal in L&T (supra) have departed from the ratio laid down in Afcons (supra) or that they have differed from it. Even though the Tribunal has remanded the matter to the adjudicating authority to determine the classification, Tribunal has also directed the adjudicating authority to take into account CESTAT Mumbai decision in AFCONS INFRASTRUCTURE LTD. VERSUS COMMISSIONER [2016 (2) TMI 1223 - BOMBAY HIGH COURT] - there is no ground for remand as prayed by the Ld. Advocate - there is also no infirmity in the demand of ₹ 2,49,31,259/- with interest and equal penalty imposed under Section 78 of the Act. Imposition of penalty u/s 78 - Held that:- This apart, the very fact that the issue has been mired in litigation for quite some time and only by the Afcons decision (supra) has it been decided by the Tribunal that OT is not a transport terminal for the purposes of Section 65 (25b) of the Finance Act, 1994, and appeal against the Afcons decision has been admitted by the Hon’ble High Court of Bombay [2016 (2) TMI 1223 - BOMBAY HIGH COURT], there is a case for setting aside penalties imposed on the appellant in respect of this demand - penalties set aside. Penalty u/s 78 in respect of delayed payment of service tax in respect of contracts other than to L&T - Held that:- Considering that the related demand itself may have been put to question in view the Hon’ble Supreme Court judgment in L&T [2015 (8) TMI 749 - SUPREME COURT] which was pronounced by the Apex Court in October 2015, the imposition of penalty under Section of the Act is unjustified and requires to be set aside Liability of service tax - interest on the value of goods and materials supplied by clients / customers to the appellants free of cost - Held that:- Consequent to the ratio laid down by the Hon’ble Apex Court in the case of CST Vs Bhayana Builders (P) Ltd. [2018 (2) TMI 1325 - SUPREME COURT OF INDIA], the value which is not part of the contract between service provider and the service recipient has no relevance in the determination of the value of taxable service provided by the service provider - demand set aside. Appeal disposed off
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