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M/s. RRB Energy Ltd. Versus Commissioner of Service Tax, Chennai

2016 (7) TMI 304 - CESTAT CHENNAI

Demand of service on Civil Work, Infrastructure Charges paid to TNEB - Denial of cenvat credit - erection and installation of the work of electricity generation system which is a composite contract involving the installation of generator as well as execution of Civil Work carried out by the appellant. - Held that:- Erection service provided was purely a Works Contract Service since that involved Civil Works as well as Electrical Works. Such works carried out before 01.06.2007 shall not be taxabl .....

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not liable to service tax thereon. - The Cenvat credit denied pertains to the input credit taken by the appellant for use thereof in manufacture of the generators. The generator not being liable to duty by virtue of exemption, appellant is liable to pay back entire credit taken to the State with interest. It is made clear that utilisation of the credit shall be calculated from the date of utilisation thereof and interest, if any, payable shall be calculated from that date till the period tha .....

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V. Padmanabhan, Technical Member For the Appellant : Shri Raghavan Ramabhadran, Ms. Swetha Giridhar, Adv/s. For the Respondent : Shri L. Paneerselvan, AC (AR) ORDER Learned counsel submitted that in both the appeals, there are only two different period involved with same facts for which both the cases may be heard analogous and disposed. So also, he says the Order-in-Original is also a common order in both the cases. 2. On behalf of the appellant, learned counsel explains that the dispute in bo .....

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rastructure development has been sought to be taxed under Finance Act, 1994 for the period 10.09.2004 to 31.03.2009 raising tax demand of ₹ 7,63,33,154/-; (iv) Land development charges, which are in the nature of Transfer of Immovable Property has been sought to be taxed for the period 10.09.2004 to 31.03.2009 raising tax demand of ₹ 2,32,94,425/-; and (v) Denying Cenvat credit for the period 01.10.2006 to 31.03.2008 demand of ₹ 4,70,91,013/- has been levied. 3.1 Explaining on .....

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works meant for installation of generator. Law is well settled in Commissioner of Central Excise & Customs, Kerala Vs Larsen & Toubro Ltd., reported in 2015 (39) S.T.R.913 (S.C.) holding that Works Contract not being intended to be taxed prior to 01.06.2007, there shall not be levy for the period 10.09.2004 to 31.03.2006.As a result of which, the demand of ₹ 3,45,91,502/- shall not sustain. 4. Explaining on the taxability of Erection charges, learned counsel submits that there is n .....

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ices provided by TNEB that is not taxable since. Therefore, the Development Charges shall be out of the ambit of taxation under the provisions of the Finance Act, 1994. Further explaining the issue, learned counsel submits that the appellant as a contractor pays the Infrastructure Charges to TNEB first on behalf of the client and gets reimbursement thereof form by clients. 6. So far as land development Charges are concerned, it was explained that the lands are first acquired by the appellant and .....

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nd owner to the clients. That also shall not come within the scope of taxation under Finance Act, 1994. He also explained that there was a confusion by the tax administration and they misconceived in adjudication that land development Charges received were an account of erection charges While allegation was that receipts relates to real estate service provided. Therefore adjudication is beyond the show-cause notice. Show-cause notice provides opportunity of defence. That was issued to explain on .....

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edit taken wrongly and utilised the same. Therefore Revenue did not suffer. Discharge of duty liability is also an admitted fact in para 12.1 of the adjudication order. Learned counsel emphasizes that if at all liability arises on the Cenvat credit issue for Calculation of interest on utilised credit, that shall be governed by the judgment of the Hon ble Madras High Court in the case of Commissioner of Central Excise, Madurai Vs Strategic Engineering (P) Ltd., reported in 2014 (310) E.L.T.509 (M .....

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he generator had also an obligation to erect and commission the same for its clients. Erection service provided was purely a Works Contract Service since that involved Civil Works as well as Electrical Works. Such works carried out before 01.06.2007 shall not be taxable following the ratio laid down by apex court in the cased of Commissioner of Central Excise & Customs, Kerala Vs Larsen & Toubro Ltd., reported in 2015 (39) S.T.R. 913 (S.C.). The dispute in the present appeal related to t .....

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fair. Revenue is to work out the demand aspect on this count and appropriate the tax already paid. Unpaid amount shall be realised with interest. Learned counsel prays that department should provide the details of payment and deficiency, if any for its Verification. No adverse view on such count shall be taken by the department since appellants approach appears to be fair on the issue. 12. The Infrastructure Charges paid to TNEB and incurred by the appellant directly as well as reimbursed to i .....

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e appellant cannot be brought to the taxing entry of Real Estate Developer. The transfer of property transactions are governed by Transfer of Property Act. Therefore, there shall be no liability for the period 10.09.2004 to 31.03.2009 on such count. 14. The Cenvat credit denied pertains to the input credit taken by the appellant for use thereof in manufacture of the generators. The generator not being liable to duty by virtue of exemption, appellant is liable to pay back entire credit taken to t .....

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