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2020 (6) TMI 260 - CESTAT HYDERABADNon-payment of service tax - Composite Contract - Construction Services - Appellant was paying service tax regularly on all the services and stopped making payment of tax from January, 2009 in view of Circular No. 108/02/2009 – ST dated 29.01.2009 - whether composite contracts are liable to service tax prior to 01.06.2007 when the classification of works contract service was introduced in the Finance Act, 1994 w.e.f. 01.06.2007? HELD THAT:- Admittedly, the appellant have supplied both material and labour / service in the contracts executed by them. We find that the issue is no longer res-integra and it has been held by Hon’ble Supreme Court in the case of COMMISSIONER, CENTRAL EXCISE & CUSTOMS VERSUS M/S LARSEN & TOUBRO LTD. AND OTHERS [2015 (8) TMI 749 - SUPREME COURT] that prior to 01.06.2007 only service contracts simplisitter (not involving supply of material) are taxable under the existing classification of CICS, ICS, CCS, etc. - demand set aside. Service tax liability on promoters / builder / developer prior to 01.06.2010 in respect of construction of residential complex - HELD THAT:- The CBEC by way of clarification vide Circular No. 108/02/2009-ST dated 29.01.2009 r/w Circular No. 151/2/2012-ST dated 10.02.2012, have clarified that for the period prior to 01.06.2010, construction(residential) provided by builder / developer will not be taxable - Admittedly, the tax under this category, of ₹ 42,01,090/- relates to the period prior to 01.06.2010. Accordingly, this ground is allowed in favour of the appellant and the demand is set aside. Maintenance and repair service - HELD THAT:- Learned Counsel urges that the appellant does not dispute the tax liability, and they have already paid the amount of ₹ 90 lakhs (approximately) prior to the show cause notice, and shall pay the balance if any, upon reconciliation. Demand under the head renting of immovable properties for the period 2007-08 to 2009-10 - HELD THAT:- Learned Counsel states that they have already paid the tax prior to the issue of show cause notice, and within the window provided for payment of tax under this head, when this taxable head was re-introduced by Finance Act, 2010 after the same was quashed by Hon’ble Delhi High Court in HOME SOLUTIONS RETAILS (INDIA) LTD. VERSUS UNION OF INDIA & ORS [2011 (9) TMI 46 - DELHI HIGH COURT]. - Since admitted tax has been deposited, no penalty. Service tax of ₹ 20,685/- under the head ‘engineering consultancy services’ - HELD THAT:- Learned Counsel states that they did not dispute this amount, thus same is confirmed. - Penalty u/s 77 and 78 of the Finance Act - HELD THAT:- As the issues involved are interpretational in nature and the appellant have deposited the admitted taxes prior to issue of show cause notice, along with interest - Penalties set aside. The appellant is liable to deposit, if any tax is found short paid, on arithmetical verification. Appellant is also directed to file a calculation of their final tax liability, with the details of payment of such tax liability, before the adjudicating authority for his information and perusal - appeal allowed - decided in favor of appellant.
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