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2014 (6) TMI 831 - AT - Service TaxWorks Contract Composition Scheme - whether the appellant is eligible for ‘Composition Scheme’ under the ‘Works Contract (Composition Scheme for Payment of Service Tax) Rules, 2007’ for a works contract entered with M/s. Essar Oil Limited when some advance payments were received by the appellant prior to 01.6.2007 i.e. before introduction of Works Contract Service. - Extended period of limitation - Held that:- in respect of the services provided after 01.06.2007, which alone are regarded as ‘Works Contract Service’, the appellant had opted to pay tax at the Composition rate and not at the standard rate and was thus eligible for the composition benefit in respect of services provided after 01.06.2007. - Decision in the case of Nagarjuna Construction Company Limited vs. GOI [2012 (11) TMI 404 - SUPREME COURT] followed - Appellant has correctly availed the Composition Scheme for the Works Contracts for which the option and payment of service tax was exercised after 01.6.2007 and no service tax was paid before 01.6.2007 - Decided in favor of assessee. The classification of services rendered prior to 01.06.2007 cannot affect the assessee’s entitlement to the Composition Scheme in respect of services rendered after 01.06.2007. However, in respect of advance received prior to 01.06.2007 which tantamounts to provisions of service prior to 01.06.2007, the benefit of composition rate could not have been claimed, on the said advance and in view of our findings recorded herein above, Service Tax on the same was payable under the head of Commercial or Industrial Construction Services, as has been held by the respondent. As such, the appellants contention that they were entitled to pay tax at the composition rate on advances received prior to 01.06.2007 cannot be accepted. Extended period of limitation - held that:- The alternative question whether the appellant would have been eligible for abatement computing the tax liability only advance payments is not being analyzed by us as we find that the entire demand on this count is hopelessly barred by limitation as the factum of the advance having been received prior to 01.06.2007 and in respect of the same tax having been discharged under the composition scheme was specifically stated in the Service Tax return. It is settled law that when there is no deliberate suppression of facts, the extended period of limitation cannot be invoked. The appellant had, in fact, clearly stated in the ST-3 return that Service Tax was not discharged in view of the fact that the service in the contract was an indivisible ‘Works Contract’. - demand set aside - Decided in favour of assessee.
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