TMI Blog2011 (3) TMI 282X X X X Extracts X X X X X X X X Extracts X X X X ..... of Rs. 1,18,06,898 under section 78 and of Rs. 5,000 under section 77 of the Finance Act, 1994, imposed on the appellant vide Order-in-Original No.2/2010-ST (Commr.) dated 30.04.2010 passed by the Commissioner of Central Excise, Hyderabad-IV and also for stay on recovery thereof till the disposal of the appeal. 1.1 The allegation against the appellant is that though the "Commercial or Industrial construction service", "Construction of complex service" and "Works contract service" were taxable under section 65(105)(zzq), 65(105)(zzzh) and 65(105)(zzzza) respectively of the Finance Act, 1994 w.e.f. 10-9-2004, 16-6-2005 and 1-6-2007 respectively and the appellant during the period from 10-9-2004 to 31-3-2008 had provided these services to various customers including - Central Public Works Department; Andhra Pradesh Tourism Development Corporation Ltd., Bharat Sanchar Nigam Ltd., Hindustan Aeronautics Ltd., M/s. Covalent Laboratories Ltd., M/s. Trident Life Sciences Ltd. M/s. Aurobindo Pharma Ltd. Etc., they had neither obtained service tax registration nor did they pay any service tax on their services. In view of this, a show cause notice dated 27-8-2009 was issued to the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pect of such contracts performed during period w.e.f. 1-6-2007 is Rs. 14,50,763 against which an amount of Rs. 18,46,970 has already been paid prior to adjudication; that the buildings constructed for HAL and BSNL and Banquet Hall and Convention Centre constructed at tourist complexes of Andhra Pradesh Tourism Development Corporation cannot be called commercial complexes and hence no service tax is attracted in respect of these contracts; that some construction projects had been completed prior to 10-9-2004 on which, in any case, no service tax is payable; that the appellant, therefore, have a strong prima facie case, and an amount of Rs. 18,46,970 already paid by them is more than their actual tax liability and that in view of this, the requirement of pre-deposit of balance amount of service tax demand, interest and penalty, which will also cause financial hardship, may be waived for hearing of this appeal and recovery thereof may be stayed till the disposal of the appeal. 2.2 Shri D.P. Nagendra Kumar, the learned Jt.CDR, opposing the appellant's plea for waiver, reiterated the findings of the Commissioner in the impugned order and pleaded that Tribunal, in the case of Sunil Hi- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ipment, structures, whether prefabricated, or otherwise, installation of electrical and electronic devices, plumbing, drain laying or other installations for transport of fluids, heating, ventilation or airconditioning including related pipe work, duct work and sheet metal work, thermal insulation, sound insulation, fire proofing or water proofing, lift and escalator, fire escape staircases or elevators; or (b) Construction of a new building or a civil structure or a part thereof, or of a pipeline or conduit, primarily for the purposes of commerce or industry; or (c) Construction of a new residential complex or a part thereof; (d) Completion or finishing service, repair, alteration, renovation or restoration of, a similar services in relation to (b) and (c); and (e) Turnkey projects including engineering, procurement and construction or commissioning (EPC) projects. As per Rule 2A of the Service Tax (Determination of Value) Rules, 2006, the value of service in relation to execution of works contract, as defined in section 65(105)(zzzza), shall be the gross amount charged (excluding VAT on transfer of property in goods involved) minus the value of transfer of pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 65(105)(zzh) read with section 65(30a), the service in relation to 'Construction of Complex' means (a) construction of a new residential complex; or part thereof; or (b) completion and finishing services in relation to residential complex such as glazing, plastering, painting, floor and wall tiling; wall covering and wall papering; wood and metal joinery and carpentry; fencing and railing; construction of swimming pools; acoustic applications or fittings and other similar services; or (c) Repair alteration or renovation or restoration or similar services in relation to residential complex. 5.4 From a comparison of the service contracts covered by the definition of 'Works Contract' as given in Explanation to section 65(105)(zzzza), with the contracts for various services as mentioned in the definition of "erection, commissioning or installation service"; "commercial or industrial construction service"; and "construction of complex service" as mentioned above, it will be seen that the services mentioned in clause (ii)(a) to (ii)(d) of the definition of 'Works Contract', as given in explanation to section 65(105)(zzzza) are also covered by the definition of erection, in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... would not be taxable, is not correct. As mentioned in the Explanation to section 65(105)(zzzza) definition of works contract is only for the purpose of this sub-clause, which came into w.e.f. 1-6-2007 and during the period prior to 1-6-2007, the term "works contract" in the context of Service tax has to be given its natural meaning and the same has to be treated as a contract for work and labour or in other words, a service contract and if such a service contract is an indivisible contract for a particular service which is taxable, the same would attract service tax. The question as to whether a given service contract can be vivisected into the service portion and the goods supply portion is relevant only for the purpose of charging sales tax on goods supply portion by invoking the legal fixation of Article 366(29A) of the constitution of India, but this question is not relevant at all for the purpose of charging service tax on a service contract, which will be chargeable if the service is taxable. In our view, section 65(105)(zzzza) read with Rule 2(A) of Service Tax (Determination of Value) Rules, 2000 and Works Contract (Composition Scheme for Payment of Service Tax) Rules, 2007 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to 31-3-2006. The assessee has never disputed this fact. We are not impressed with their present attempt to escape tax liability for the period upto 31-3-2006 on the strength of a doctrine which was introduced on 1-6-2007 with prospective effect. In this view of the matter, we find that the decisions cited by the ld. counsel are of no aid to the appellant. 5.6 The judgments of the Tribunal in the cases of M/s. Diebold Systems (P.) Ltd. v. Commissioner of Service Tax, Chennai (supra); Air Liquide Engineering India (P.) Ltd. v. Commissioner of Customs and Central Excise, Hyderabad-II (supra) and URC Construction (P.). Ltd. v. Commissioner of Central Excise, Salem cited by the appellant are based on the Tribunal judgment in the case of Daelim Industrial Co. Ltd. v. CCE, Vadodara - 2006 (3) STR 124 wherein it was held that an indivisible works contract cannot be vivisected for the purpose of charging service tax on its service component. Though the Government's SLP to Hon'ble Supreme Court against the judgment of Daelim Industrial Co. Ltd. v. CC, Vadodara has been dismissed, the dismissal being summary dismissal without recording any reason, the same does not lay down any law and is ..... 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