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2022 (10) TMI 583 - HC - Service TaxLevy of Service Tax - Work Contract Services - construction of toilets, roads, sanitation, water reservoir, drinking water supply, sewage treatment plant etc - stand of the respondent is that Rajya Krishi Utpadan Mandi Parishad being a statutory authority created under the U.P. Krishi Utpadan Mandi Adhiniyam, 1964 is covered within the definition of "Government Authority" and is entitled for exemption under Clauses-12 and 13 of the Mega Exemption Notification no.25/2012-ST dated 20.06.2012 - dispute is of financial year 2015-16. HELD THAT:- The Krishi Utpadan Mandi Samiti is established by an Act of the State Legislature to provide for the regulation of sale and purchase of agricultural produce and for the establishment, superintendence and control of markets therefor in the State of Uttar Pradesh. Section 16 of U.P. Krishi Utpadan Mandi Adhiniyam has been placed before us to demonstrate that none of the functions and duties of the Committee are commercial or business in nature - It is evident from the Mandi Samiti Act that the Mandi Samiti is a Corporate body and all its functions and duties are directed towards regulating the sale and purchase of the agricultural produce. The Mandi Samiti is required to establish markets to exercise superintendence and control over the sale and purchase of the agricultural produce. The construction activities inside the Mandi area cannot be termed as business activities. In the similar facts and circumstances of this Court in Central Excise Appeal no.06 of 2022 [2022 (9) TMI 535 - ALLAHABAD HIGH COURT] had taken a view that the provisions of Mega Exemption Notification in light of the functions and duties of the Krishi Utpadan Mandi Samiti would be applicable in case of "Work Contract Services" provided by the Contractor to Krishi Utpadan Mandi Samiti and the Contractor would be entitled to exemption from levy of service tax in view of the exemption notification no. 12/2012-ST. - The argument of the learned counsel for the appellant revenue therein that the activity of letting/renting of Krishi Utpadan Mandi Samiti being commercial has been turned down. Appeal dismissed.
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