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2022 (5) TMI 142 - AT - Service TaxLevy of service tax - entire construction activity is sub-contracted - appellant not undertaking any construction by themselves - whether the Appellant is liable to pay Service Tax under complex service prior to 1.6.2007? - HELD THAT:- As per decision of the Hon’ble Supreme Court in COMMISSIONER, CENTRAL EXCISE & CUSTOMS VERSUS M/S LARSEN & TOUBRO LTD. AND OTHERS [2015 (8) TMI 749 - SUPREME COURT] held that composite contracts involving transfer of property in goods is not liable to Service Tax prior to 1.6.2007. Thus, the law on this point is well settled. Though the said grounds were not raised in the Show Cause Notice or in the impugned order, since the decision of the Hon’ble Supreme Court is binding on this Tribunal it cannot be held that the Appellant was liable to pay Service Tax. Hence, the finding of the Commissioner that the Appellant was not liable to pay Service Tax during the relevant period i.e. from April 2005 to March 2007, is upheld. Once the Appellant is not liable to pay Service Tax, they are also not entitled to avail cenvat credit of the amount collected in the name of Service Tax and is liable to be paid to the Government Exchequer. Applicability of provisions of Section 11D - HELD THAT:- The present case is one where tax was collected even though the activity was liable to tax. Only sub-section (1A) of Section 11D covers such a situation and this sub-section was introduced only in 2008 - The present case is not covered under Sub-section (1) which deals with collection of an amount of tax in excess of the liability - the demand under Section 11D for the period upto 17.04.2006 is set aside. Demand under Section 73A(2) for the period after 18.04.2006 is upheld - The demand of interest under Section 73B is set aside - The imposition of penalty under Section 77 (2) set aside - The demand towards ineligible credit is confirmed and the amount reversed as payment of Service Tax will be treated as reversal - The demand of Service Tax of Rs.17,85,000 on import of service, along with interest and imposition of penalty are set aside. Appeal allowed in part.
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