TMI Blog2010 (8) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... /WZB/AHD/2010 - Dated:- 19-8-2010 - Appellant Represented by: P M Dave, Adv. Respondent Represented by: Shri Avinash Thete, SDR CORAM: Archana Wadhwa, Member (J); B S V Murthy, Member (J) Per: Archana Wadhwa: Vide his impugned order, Commissioner of Central Excise Ahmedabad has confirmed service tax of Rs. 1,58,82,314/- against the appellant along with confirmation of interest and imposition of penalty of Rs. 1.60 Crores, under Section 78 of Finance Act, 1994. In addition, penalty of Rs. 200/- per day stands imposed In terms of Section 76 of Finance Act. 2. As per facts on record, appellant herein M/s, Dinesh Chandra R. Agarwal Infracon Pvt. Limited are registered with Service Tax department under the category of Goods Transport Agency services. However, Revenue received intelligence about the appellants providing taxable service of laying of long distance pipe lines for transfer of water in the State of Gujarat. As the appellant was not paying any service tax on the said service, investigations were conducted at their end. It was revealed that the contract for laying long distance pipe lines for transfer of water in the State of Gujarat was awarded to them by M/s. G ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vice provided or to be provided to any person, by a commercial concern, in relation to commercial or industrial construction service. 5. In view of the above definitions, it is evident that the "Construction of Pipeline or Conduit" is a taxable service subject to the following conditions :- (i) such "Pipelines or Conduit" are used, or to be used, primarily for commerce or industry; (ii) the service provider shall be a commercial concern. 6. Commissioner in his impugned order has observed that the service provided i.e. appellant who constructed the pipe lines is admittedly a commercial concern. As such, he has observed as to whether the first condition i.e. whether the pipelines were used by the GWSSB for Commerce or Industrial, or not, is required to be examined. 7. Statement of Shri B.K. Shingala, Chief Executive Engineer of GWSSB was recorded on 17.03.2007, wherein he clarified that the said body is an establishment for rapid development and proper regulation of water supply and sewerage activity in the State of Gujarat, The source of water for supply by the said establishment is either its own in terms of Well/ Tube-well or stand purchased from Sardar Sarovar Narmada N ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. I find that the said GWSSB is an independent body constituted under the Gujarat Act No. 18 of 1979. The purpose for constitution of Board is to provide rapid development and proper regulation of water supply and sewerage services in the State of Gujarat. The Board is required to render all necessary services in regard to water supply to the State Government, local bodies and on request to the private institutions and industries. The Board has the power to raise, borrow or secure money on such terms and conditions as may be expedient and in particular by way of loans and advances, deposits and issue of debentures and obtain subventions or mortgage from public institutions like LIC, Banks, or from the State or Central Government. As per Section 3(2) of the said Act of 1978, GWSSB is a body corporate having perpetual succession and a common seal with powers to acquire, hold or dispose of property, both movable and immovable and to contract, and may sue or be sued by its corporate name. As per Section 14 and 15 of the said of 1978, the GWSSB has to render all necessary services in regard to water supply and sewerage to the State Government and local bodies and on request to private ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t has to be held that appellant had provided the construction services to GWSSB and he is liable to pay the service tax on the same. 9. The Commissioner has also upheld the invocation of longer period of limitation in the show cause notice by observing that there was mens-rea on the part of the assessee, inasmuch as the appellants was already a registered assessee with the service tax department for the purposes of Goods Transport Act and were aware of the service tax law. By pleading ignorance of law, appellants cannot discharge the onus of bonafide. Accordingly, he confirmed the demand and imposed penalties. 10. Learned advocate for the appellants has assailed the impugned order on merits as also on limitation. Learned DR has supported the impugned order by reiterating the reasoning adopted by the Commissioner. 11. After carefully appreciating the submissions made by both the sides, we find that there is no dispute about the legal position that the category of service of "Commercial or Industrial Construction" creates liability to pay service tax on the construction activities if the pipelines or conduits are used or to be used primarily for Commerce or Industry. The Board ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... requirements of materials and arrange for their procurement and utilization; (f) to establish State standards for water supply and sewerage services; (g) to review annually the technically financial, economic and other aspects of water supply and sewerage system every scheme of the Board or the local bodies which have entered into an agreement with the Board: (h) to establish and maintain a facility to review and apprise the technical, financial, economic and other pertinent aspects of every water supply and sewerage scheme in the state; (i) to operate , run and maintain any water works and sewerage system, if and when directed by the State Government, on such terms and conditions and for such period as may be specified by the State Government. (j) to assess the requirements for man-power and training in relation to water supply and sewerage services in the State; (k) to carry out applied research for efficient discharge of the duties and functions of the Board; (I) to perform such of the duties and functions, which are being performed by the Gujarat Public Health Engineering Service, as may be specified, from time to time; (m) to perform and discharge such other du ..... X X X X Extracts X X X X X X X X Extracts X X X X
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