TMI Blog2018 (8) TMI 627X X X X Extracts X X X X X X X X Extracts X X X X ..... TMI 749 - SUPREME COURT] in respect of such kind of works contract is that they remain works contract pre and post 01.06.2007, would cover the issue in favour of appellant and demand of differential service tax liability for the period April and May, 2007 and after June, 2007 a works contract. The adjudicating authority in the case in hand has misdirected his finding to record that construction of ash dyke cannot be considered as works contract and benefit of the Works Contract (composition scheme for payment of Service Tax) Rules, 2007 cannot be extended. The findings recorded by the adjudicating authority on the confirmation of the demand of differential duty under this category are correct and does not require any interference - T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in present cases relate to (i) Work Order dated 08.12.2006 were construction of Ash dyke at Lanco Amarkantak Thermal Power Station (300MW), Korba, Chhattisgarh. (ii) Work Order dated 13.04.2007 for site grading works at 2 x 507.5 MW Nagarjuna Thermal Power Project at Padubidri, Udipi District, Karnataka. 3. The Revenue Authorities issued two show cause notices on the allegations that for the period April and March, 2007, they have improperly discharged Service Tax less after availing abatement of 67% in terms of Notification No.01/2006 and from June, 2007 onwards, they have wrongly discharged Service Tax @ 2% availing benefit of Works Contract (composition scheme for payment of Service Tax) Rules, 2007 which is incorrect as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch activity and has considered the same as a Works Contract and hence, for the entire period from April, 2007 to March, 2009, the said contract needs to be looked into as Works Contract and as per the decision of the Supreme Court in the case of Larsen and Tubro Ltd [2015 (39) STR 913], the works contract cannot be vivisected to impost Service Tax. As regards the demand of Service Tax liability under site formation and clearance, excavation and earth moving and demolition for the Work Order issued on Nagarjuna thermal power project, it is his submission that the said activity is in preparation/earth work for the roads and benefit of Notification No.17/2005-ST would be applicable as it is in respect of construction of roads. Learned Counsel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... th work for the roads. He submits that the benefit of Notification No.17/2005 extended to the activity of site formation for construction of road does not envisage this activity. 6. On careful consideration of the submissions made, we find that the issue/facts are stated correctly by both sides; it is whether differential service tax liability needs to be discharged by the appellant herein for the period April, 2007 and May, 2007 without extending benefit of abatement of Notification No.01/2006 and for the subsequent period whether ash dyke constructed by the appellant would fall under the works contract services or site formation and clearance services. Addressing the first issue of the demand for the period April and May, 2007, we find ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... garjuna Thermal Power Project at Padubidri, Udipi District, Karnataka, the reading of the said contract indicates clearly that the entire contract is only for site formation and clearance, excavation and earth moving and demolition services. The bill of quantities enclosed in the said contract talks about tree cutting, site clearing and grubbing, earth work in excavation, earth work in filling, mechanical carriage (for carriage beyond the initial lead of 1.0 KM) and earth work for roads. The tax liability which has been sought and confirmed from the appellant is in respect of the earth work for roads executed by the appellant for the thermal power plant. We find that the arguments put forth by the Learned Counsel that these activities amoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oads, airports, railways, transport terminals, bridges, tunnels, dams, ports or other ports, from the whole of service tax leviable thereon under section66 of the said Finance Act. 8. In our view, the findings recorded by the adjudicating authority on the confirmation of the demand of differential duty under this category are correct and does not require any interference. The demand of ₹ 72,08,553/- along with interest is upheld. As regards penalty imposed on the appellant on this activity, we find that the issue of whether the activity would fall under the category of construction of road or otherwise is an issue of interpretation of Notification No. 17/2005-ST. In our view, the appellant could have entertained a bona fide beli ..... X X X X Extracts X X X X X X X X Extracts X X X X
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