TMI Blog2018 (6) TMI 1357X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 - Mr. Anil Choudhary, Member (Judicial) And Mr. Anil G. Shakkarwar, Member (Technical) Shri Kapil Vaish (CA) for Appellant(s) Shri Rajeev Ranjan (Joint Commr.) AR for Respondent(s) Per: Anil G. Shakkarwar Heard on Misc. Application in Appeal No. ST/70598/2017. Learned counsel for the appellant has contended that the appeal relates to demand of service tax under the category of Construction of Complex Service after obtaining the completion certificate and the issue is recurring in nature and huge demand has been confirmed and, therefore, requested for early hearing. Learned AR did not oppose the said prayer. After allowing Misc. Applications for early hearing and condonation of delay for filing appeal by Shri Jai Kishore with the consent of both sides main appeal was taken for hearing and decision. 2. Above stated two appeals are arising out of common impugned Order-in-Original No. 21/2017-ST dated 29.05.2017 passed by Additional Director General (Adjudication) of DGCEI, New Delhi. Since both the appeals are arising out of common order, they are taken together for decision. 3. Brief facts of the case are that the appellants were engaged in the const ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct of their projects Orange County Olive County respectively. Further he has held that noticees/appellants contentions are that the construction of the complexes was completed before issue of completion certificate was not tenable, therefore, he through impugned Order-in-Original confirmed the demand of service tax amounting to ₹ 8,44,29,641/- for the period from 01.04.2010 to 31.03.2015 and dropped the demand of service tax of ₹ 69,19,139/- on Interest Free Maintenance Security and Club Security. He appropriated an amount of ₹ 92,34,400/- and imposed penalty of ₹ 13,85,160/- under Section 78 of the Finance Act, 1994 for the period July, 2010 to March, 2011. He further imposed penalty of ₹ 3,75,97,621/- under Section 78 (i) second proviso of the Finance Act, 1994. Further, he imposed penalty of ₹ 1 lakhs on Shri Jai Kishor, Director under Section 78 A of the Finance Act, 1994. Aggrieved by the said order both the appellants are before this Tribunal. 4. Heard the learned counsel for the appellants. He has submitted that the Original Authority has already held that there was no dispute that completion certificated was issued by Shri Vishal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ii. Section 65(91a) or the Finance Act, 1944 defined residential complex‟ as under; (i) A building or buildings, having more than twelve residential units; (ii) A common area; and (iii) Any one or more of facilities or services such as park, lift, parking space, community hall, common water supply or effluent treatment system, Located with a premises and the layout of such premises is approved by an authority under any law for the time being in force, but does not include a complex which is constructed by a person directly engaged any other person for designing or planning of the layout, and the construction of such complex is intended for personal use as residence by such person. Explanation- For the removal of doubts, it is hereby declared that for the purpose of this clause,- (a) personal use includes permitting the complex for use as residence by another person on rent or without consideration; (b) residential unit means a single house or a single apartment intended for use as a place of residentce; iv. Section 65(25b) of the Finance Act, 1944 defined commercial or industrial construction‟ as under: a) Constructi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s under: Explanation For the purposes of this sub-clause, the construction of a new building which is intended for sale, wholly or partly, by a builder or any person authorized by the builder before, during or after construction (except in cases for which no sum is received from or on behalf of the prospective buyer by the builder or the person authorized by the builder before grant of completion certificate by the authority competent to issue such certificate under any law for the time being in force) shall be deemed to be service provided by the builder to the buyer. ix. With effect from 01.07.2010, service tax was levied on preferential location charges also. The taxable entry was 65(105)(zzzzu). It reads as under:- to a buyer, by a builder of a residential complex, or a commercial complex, or any other person authorized by such builder, for providing preferential location or development of such complex but does not include services covered under sub-clause (zzg), (zzq), (zzzh) and in relation to parking place . Explanation, - For the purpose of this sub-clause, preferential location means any location having extra advantage which attracts ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tered with the Institution of Engineers (India); or C. licensed surveyor of the respective local body of the city or town or village or development or planning authority, who is authorized under any law for the time being in force, to issue a completion certificate in respect of residential commercial or industrial complex, as a precondition for its occupation. iv. Section 66B levies service tax on value of all taxable services provided or agreed to be provided in the taxable territory by one person to another. S. No. 12 of the Notification No. 26/2012-ST dated 20.06.2012 effective from 01.07.2012, exempted the taxable service of Construction of complex, building, civil structure or a part thereof, intended for sale to a buyer, wholly or partly except where the entire consideration is received after issuance of completion certificate by the competent authority from so much of service tax leviable thereon under Section 66B of the Act, as is in excess of the service tax calculated on value which is equivalent to 25% of the gross amount charged by such service provider for providing the said taxable service, subject to the condition that Cenvat credit on inputs& ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iii. NOC/sanctions, electrical connection, sewer connection, water connection, lift installation, payment of compounding fee prior to the date of completion certificate proves that the two projects were complete on the given date. iv. In view of the sale deeds registered around the date of completion, it cannot be said that flats were not in liveable conditions. v. DGCEI cannot change its opinion on the issue of validity of completion certificate by an architect. vi. Amount of ₹ 44.97 lacs deposited during investigation has to be deemed to be paid under protest and cannot be allocated for the time barred demand. vii. Extended period of limitation cannot be invoked. viii. Penalties under Sections 77 and 78 cannot be imposed. ix. Penalty on Director is not imposable. 7. Further learned C.A. has submitted that clarification issued by CBEC through Letter D.O.F. No. 334/3/2010-TRU, dated 01.07.2010, clarified that completion certificate issued by an Architect or Chartered Engineer or Licensed Surveyor can be taken to determine the service tax liability. He submitted that through the said clarification, CBEC have clarified that a completi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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