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2018 (7) TMI 856

er projects for generation of electricity for TNEB - N/N. 11/2010-ST and 45/2010-ST - Held that:- The Tribunal in the case of PES Engineers (P) Ltd, [2017 (7) TMI 687 - CESTAT HYDERABAD], has held that irrespective of the classification of services of service relating to/for transmission of electricity are exempted from payment of service tax by this notification - demand cannot sustain. - Works contract service - dedicated water supply scheme to Coimbatore City Municipal Corporation under JNNURM Scheme - Held that:- This being public utility service and not being for commercial purpose, is not covered under taxable services - The Tribunal in the case of BMS Projects (P) Ltd. [2017 (9) TMI 1386 - GUJARAT HIGH COURT] has held the above services to be not liable to levy of service tax - demand cannot sustain. - Supply of tangible goods service - renting of construction of equipment by the appellant to L&T - Works contract service in respect of hydro power projects - Held that:- Evidently, the value of these services being less than ₹ 10 lakhs is exempted under N/N. 6/2005-ST as all other income of the appellant falls under exempted services - the demand cannot sustain a .....

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ing of construction equipment to L&T under the category of supply of tangible goods. In ST/40355/2015, apart from services relating to hydro power projects, a demand was made in respect of services for construction of staff quarters for TNEB in power project under the category of works contract service. 3. In Appeal No. ST/40140 and 41537/2015, the demand of service tax is in respect of services related to management, maintenance or repair services of various civil structures (office, quarters, inspection bungalow) at Periyar Lower Camp/Suriliyar Lower Camp for hydroelectric power projects. The show cause notices issued in the above appeals, after adjudication culminated in confirmation of the demand along with interest and imposing penalties. Against the orders passed by Commissioner of Central Excise, Salem, the appellants are before the Tribunal in ST/40357/205, ST/40436/2015 and ST/40355/2015. Appeals ST/40140/2015 and ST/41537/2015 are filed by the appellants against the orders passed by Commissioner of Central Excise (Appeals), Madurai who upheld the confirmation of demand of service tax, interest and penalties. 4. On behalf of the appellants, ld. counsel Shri S. Durairaj .....

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rks contract services in the impugned order. These services are for generation of electricity in a hydro power project, which is in relation to/for transmission of electricity. Works contracts relating to power projects are not taxable services as held in the case of PES Engineers (P) Ltd Vs. CCE - 2017 (7) GSTL 57 (Trib Hyd). Irrespective of the classification of services, all services relating to/for transmission of electricity are exempted from payment of services tax by notification 11/2010-ST and 45/2010-ST. Catena of decisions are relied in this regard. 4.4 ₹ 59,879/- was demanded on supply of tangible goods services for the years 2008-09, 2009-10, 2010-11 (Annexure B to the SCN). As their main services were exempted as stated above, such turnover was excluded to determine the thresh hold exemption of ₹ 10 lakhs as per notification 6/2005-ST, copy placed in the typed set. Therefore, all these years, the turnover of supply of tangible goods services is less than ₹ 10 lakhs. Therefore, the demand is not sustainable. Appeal No-ST/40355/2015 4.5 The total demand is ₹ 1,18,50,040/- for the period from 04/2008 to 06/2012. ₹ 1,15,03,478/- was demanded f .....

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ion 30 of Section 2 of Electricity Act, 2003, generating station includes staff quarters and other buildings. All services relating to/for transmission of electricity are exempted from payment of services tax by notification 11/2010-ST and 45/2010-ST. Catena of decisions are relied in this regard. Appeal No. ST/41537/2015 4.8 The total demand is ₹ 10,24,864/- for the period from 04/2008 to 08/2012. It was demanded for the services of management, maintenance or repair services of various civil structures (office, quarters, inspection bungalow) at Suriliyar Lower Camp (Small hydroelectric power projects) of hydro power projects (generation of electricity) for TNEB Ltd, which is wholly owned by Government of Tamilnadu. In the impugned order, these activities were classified as management, maintenance or repair services. These services are for generation of electricity in a hydro power project, which is in relation to/for transmission of electricity. As per sub section 30 of Section 2 of Electricity Act, 2003, generating station includes staff quarters and other buildings. All services relating to/for transmission of electricity are exempted from payment of services tax by notifi .....

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enting of construction of equipment by the appellant to L&T. Evidently, the value of these services being less than ₹ 10 lakhs is exempted under Notification No.6/2005-ST as all other income of the appellant falls under exempted services. This demand, therefore, cannot sustain as it falls below threshold limit and requires to be set aside which we hereby do. 7.3 In ST/40355/2015, apart from the demand of service tax in respect of hydro power projects, the department has demanded service tax to the tune of ₹ 3,46,562/- under works contract service for construction of staff quarters for TNEB employees in the power project. The Id. counsel has submitted that as per sub-section (30) of Section 2 of Electricity Act, 2003, a generating station includes staff quarters and other buildings. Thus, the exemption under Notification Nos. 11/2010-ST and 45/2010-ST which exempts services in respect of hydro power projects would cover these services also. The Tribunal vide Final Order No. 41143 to 41146/2018 dated 13.4.2018 in Sima Engineering Constructions has considered the very same issue and held that such services of construction of staff quarters inside the power project is n .....

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