TMI Blog2015 (10) TMI 1302X X X X Extracts X X X X X X X X Extracts X X X X ..... /11-Mum And ST/CO/52, 53/11-Mum - ORDER NO.A/3109-3112/15/STB - Dated:- 2-9-2015 - Mr. M.V. Ravindran, Member (Judicial) And Mr. C.J. Mathew, Member (Technical) Shri H.G. Dhareadlikari, Advocate : For The Petitioner Shri B. Kumar Iyer, Supdt. (AR) : For The Respondent ORDER Per: M.V. Ravindran These two appeals and the cross objection filed by the Revenue are disposed of by a common order as the issue involved is the same. 2. Relevant facts that arise for consideration of M/s Uhde India Ltd. the appellant no. (1) are engaged in rendering services under the category of Consulting India Services, M/s Rashtriya Chemicals Fertilizers Ltd. is the appellant no. (2) are engaged to manufacturing of fertilizers. Appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dispute as to the facts that the contract of setting up a Nitric Acid plant is a works contract. He would submit that Hon ble Supreme Court in the recent judgment in the case of Larsen and Tourbo Ltd. others as reported at 2015-TIOL-187-SC-ST has clearly settled a law holding that Composite Works Contract cannot be vivisected to tax under any heading prior to 1.6.2007. He reads the specific paragraphs. 4. Learned departmental representative on the other hand submits that the judgment of Hon ble SC is in respect of the works contract executed which are indivisible in nature; he would submit that in the case is in hand, the Works Contract awarded to appellant No. 1 is divisible one, in as much the schedule for payment indicates the pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arged appropriate works contract tax to state government authorities. We find that appellant had make out a case in their favor on to that the service tax liability on the works contract will be applicable only from 1/06/2007. This view is fortified by the Apex Courts in judgment in the case Larsen and Tourbo Ltd and others (supra). With respect, we reproduce the relevant paragraphs of the ratio of the Apex court. 15. A reading of this judgment, on which counsel for the assessees heavily relied, would go to show that the separation of the value of goods contained in the execution of a works contract will have to be determined by working from the value of the entire works contract and deducting therefrom charges towards labour and servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... property in goods in such contract. This being the case, we feel that the learned counsel for the assessees are on firm ground when they state that the service tax charging section itself must lay down with specificity that the levy of service tax can only be on works contracts, and the measure of tax can only be on that portion of works contracts which contain a service element which is to be derived from the gross amount charged for the works contract less the value of property in goods transferred in the execution of the works contract. This not having been done by the Finance Act, 1994, it is clear that any charge to tax under the five heads in Section 65(105) noticed above would only be of service contracts simpliciter and not composi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of roads, airports, airways transport, bridges, tunnels, and dams. These infrastructure projects have been excluded and continue to be excluded presumably because they are conceived in the national interest. If learned counsel for the revenue were right, each of these excluded works contracts could be taxed under the five sub-heads of Section 65(105) contained in the Finance Act, 1994. For example, a works contract involving the construction of a bridge or dam or tunnel would presumably fall within Section 65(105)(zzd) as a contract which relates to erection, commissioning or installation. It is clear that such contracts were never intended to be the subject matter of service tax. Yet, if learned counsel for the revenue is right, such cont ..... X X X X Extracts X X X X X X X X Extracts X X X X
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