TMI Blog2014 (9) TMI 150X X X X Extracts X X X X X X X X Extracts X X X X ..... ation No. 12/2003, as discussed earlier the benefit of exemption Notification No. 12/2003-ST cannot be granted merely on the basis of overall estimation/approximations put forth and without any documentary proof specifically indicating the value of goods and materials sold in respect of the individual recipients of service as per the contracts entered into by the appellants with each of them. They have failed to produce such documentary proof so far. The appellants insist that they have such documentary proof and would be able to produce the same. In such a situation, it is only fair that the case is remanded to the adjudicating authority to enable the appellants to do so. - Decided partly in favor of assessee. Extended period of limitation - Held that:- the fact that the appellants did not inform the department that they were claiming the said exemption notifications in respect of completion and finishing services coupled with the fact that they so brazenly and blatantly indulged in claiming the benefit under the said notifications in spite of the fact that the said notifications were so expressly, conspicuously and unambiguously not applicable for the said services establishe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion No. 12/2003-ST was not available to the appellants. 3. In their appeal the appellants have essentially contended as under: (1) The adjudicating authority has gone beyond the Show Cause Notice in as much as the adjudicating authority has denied the benefit of Notification No. 12/2003-ST on the ground not mentioned in the Show Cause Notice. (2) They are eligible for Notification No. 12/2003-ST as there has been transfer of goods and materials in the execution of their works and as per the 46th Amendment to the Constitution, their works contracts involve both sale and service and on sale portion service tax can not be charged. (4) Service Tax cannot be charged on the value of goods and materials sold while providing the impugned service. (5) The decision of CESTAT in Deluxe Colour Lab and others VS. CCE, Jaipur 2008 (17) STT 481 (New Delhi CESTAT) supports their contention. (6) Bifurcation of goods and material on invoices issued by appellant is not a must and only documentary evidence of value of goods and material sold is required for claiming the benefit of Notification No. 12/2003 dated 20.06.2003. (7) They also referred to the judgments in case of Expr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd the Show Cause Notice issued to them inter alia required them to show cause notice as to why the benefit of those Notifications should not be denied to them as the same were not applicable in respect of completion and finishing services. It is seen that during the adjudication or in their appeal before CESTAT the appellants have not contended that they are eligible for the benefit of exemption under Notifications No. 15/2004-ST and 1/2006-ST. Thus the adjudication authority was right in denying the benefit of the said two notifications to the appellants. 7. It is also seen that the question of appellants eligibility for benefit of Notification No. 12/2003-ST was not the direct subject matter of Show Cause Notice and the Show Cause Notice did not require them to show cause as to why they should not be denied the benefit of the said notification and understandably so because during investigation, the appellants admitted to have availed of benefit of Notification No. 15/2004-ST and Notification 1/2006-ST and their documents like ST-3 Returns also supported the same and also in their invoices they had uniformly deducted 67% from the gross invoice-value and paid service tax on 33 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f goods and material as they are liable to sales tax. Indeed, the adjudicating authority in para 51 of the impugned order takes due notice thereof without quarrelling. The exemption Notification No. 12/2003-ST is in effect not in disharmony with the said Constitutional amendment. Indeed, as clearly laid down in the said exemption notification, service tax is not to be levied on the value of the goods and materials sold by the service provider to the service recipients provided there is documentary proof specifically indicating the value of the said goods and materials. Thus what is mandatorily required to claim the benefit of Notification No. 12/2003-ST is nothing short of documentary proof and that too of such a nature which specifically indicates the value of such goods and materials. Thus, mere plausible explanations and/or approximations regarding value of said goods and materials are clearly insufficient for the purpose of Notification No. 12/2003-ST. In the present case the appellants on being found out having illegally availed of Notification No. 15/2004-ST and Notification 1/2006-ST have attempted to get covered under Notification No. 12/2003-ST. But it is seen from th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s (Supra) and the case laws cited by the appellants are of the years prior to the year of the said judgments of Hon ble Delhi High Court. In this regard, it is pertinent to quote a few relevant paras from the judgement of the Hon ble Delhi High Court in case of G. D. Builders (supra). Para 23. The state Legislature is competent to impose tax on transfer of property in goods involved in works contract . The Parliament can enact laws which can specify restrictions and conditions regarding the system of levy, rates or incidence of tax, but this is not a pre-condition. It means that if the Parliament enacts a law, the exercise of legislative power of the State would be subject to a system of levy, rates or incidence of tax. Most importantly it has been observed that measure of levy of tax contemplated by Article 366(29A) (b) is the value of the goods involved in execution of work contract since the taxable event is the transfer of properly in goods, the said transfer takes place when the goods are incorporated in the works, the value of goods, which can constitute the measure for the levy has to be the value of goods at the time of incorporation of the goods in the works. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ara 29. 2. Association of Leasing and Financial Service Companies v. Union of India - 2010(20) STR 417 (S.C.) Relied on [Para 30] 3. Gannon Dunkerley and Co. v. State of Rajasthan - (1993) 1 SCC 364 -Referred [Paras 23,24,26] 4. Gujara Ambuja Cements Ltd. v. Union of India - 2006 (3) STR 608 (S.C.)= 2005 (182) ELT 33 (S.C.) Relied on [Para ] 5. Home Solutions Retails (India) Ltd. v. Union of India -2011 (24) STR 129 (Del.)-Relied on [Para 19] 6. Delhi Chit Fund Association v. Union of India 2013 (30) STR 347 (Del.)- Relied on [Para 37] 7. Intercontinental Consultants and Technocrats Pvt. Ltd. v. Union of India -2013 (29) STR 9 (Del.)-Relied on [Para 37] 8. K. Raheja Development Corporation v. State of Karnataka 2006 (3) STR 337 (S.C.) - Relied on [Para 21,22] 9. Larsen Toubro Ltd. v. State of Karnataka - Civil Appeal No. 8672 of 2013 of Supreme Court -Followed [Para 22] 10. Mahim Patra, Pvt. Ltd. v. Union of India- 2007 (7) STR 110 (s.C.)-Referred [Paras 24,25,27] 11. Nagarjuna Constn. Co. Ltd. v. Government of India-2012 (28) STR 561 (S.C.)-Relied on [Para 35] 12. Nagarjuna construction Co. Ltd. v. Government of India -2010(19) STR 321 (A.P.) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is remanded to the adjudicating authority to enable the appellants to do so. 14. As regards the allegation of suppression of facts, it is seen that the appellants deliberately indulged in deducting 67% from the gross value shown in the invoices and paid service tax only on 33% under Notification No. 15/2004-ST and Notification No. 1/2006-ST, admitted to have availed of the said notifications and even mentioned these notifications in their ST-3 Returns even when the said notifications specifically, unambiguously and expressly debarred completion and finishing services from such benefit and also they (i.e. appellants) nowhere disclosed that the service for which the said exemption notifications were claimed was completion and finishing service. All this clearly establishes suppression of facts on their part with intention to evade service tax. The judgments cited by them in this regard do not come to their rescue as none of them deals with a situation where benefit of an exemption notification was claimed so brazenly and blatantly to evade service tax when there was no scope for any ambiguity or confusion regarding the inadmissibility thereof. In coming to a finding regarding supp ..... X X X X Extracts X X X X X X X X Extracts X X X X
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