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2023 (4) TMI 323 - AT - Service TaxValuation - Erection, Installation and Commissioning service or Construction Service? - non-inclusion of value of material supplied by their clients in the gross value of the service for payment of service tax - applicability of N/N. 19/2003-ST dated 21.08.2003, N/N. 15/2004-ST dated 10.09.2004 and N/N. 1/2006-ST dated 01.03.2006 - HELD THAT:- This issue now is no longer res-integra as in the various judgments including the judgment of BHAYANA BUILDERS [[2013 (9) TMI 294 - CESTAT NEW DELHI (LB)]], the Tribunal has held that for availing abatement under notifications 19/2003-ST dated 21.08.2003, 15/2004-ST dated 10.09.2004 and Notification No. 1/2006-ST dated 01.03.2006, the value of the material provided by the service recipient to the service provider shall not be included in the gross value for the purpose of charging service tax - The said Larger Bench decision of Bhayana Builders (P) Limited has been upheld by the Hon’ble Supreme Court in COMMISSIONER OF SERVICE TAX ETC. VERSUS M/S. BHAYANA BUILDERS (P) LTD. ETC. [2018 (2) TMI 1325 - SUPREME COURT]. As per Section 67 of Finance Act, 1994 only that value which is charged by the service provider to the service recipient shall be considered the gross value. Value of the material supplied by the service recipient since not charged by the service provider, cannot be included in the gross value of the service. In view of the settled legal position by the Apex Court, charge of the department clearly fails and on that basis exemption cannot be denied. Charge of mis-declaration of classification - HELD THAT:- Whether the service classified under Construction Service as claimed by the appellant or under Erection, Commissioning or Installation service as held by the Revenue, the abatement of 67% is available in both the categories therefore, the misclassification of service does not have any revenue implications. It is observed that the appellant have rented out Hydra Crane also however, there is no separate working of service tax on the said element. The Adjudicating Authority need to re-quantify the service tax if any arises after allowing the abatement in respect of services of Erection, Commissioning or Installation - the impugned order is set-aside - Appeal allowed by way of remand.
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