TMI Blog2018 (10) TMI 545X X X X Extracts X X X X X X X X Extracts X X X X ..... e appellant on turnkey basis for laying the foundation as per the design, erect tower materials on the foundation, civil works for base station and consumption of materials like cement, steel for laying the foundation and construction of petrol pumps, industrial buildings are undisputedly composite contract for supply in materials and in the case of works contract in respect of railways, it is a works contract awarded to the appellant - the tax demand confirmed on tower implementation service, erection and painting services, erection services as sub-contractor and erection of signalling system for railways and construction services rendered to IOCL for the period prior to 01.06.2007 needs to be set aside. Demands raised on appellant post 01.06.2007 under the category of tower implementation services and erection and installation services as a sub-contractor - Held that:- The demands raised under these two heads needs reconsideration by the adjudicating authority as the random perusal of the documents and impugned order indicate that the claim of the appellant has not been considered in proper perspective by the adjudicating authority - matter on remand. Demand on signalli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellant and following due process of law by Order-in-Original dated 31.12.2008 confirmed the demands raised on the following grounds: (1) That the benefit of abatement under Notification no.19/2003 is available to only a contract for supplying plant, machinery or equipment and commissioning and installation of the said plant, machinery or equipment and not for supply on cement or steel. (2) No proof has been submitted that the main service provider has discharged the duty. (3) Railway Signalling System cannot be treated as construction services. (4) Classification of railway signalling system as structure is not acceptable. 3. Learned Counsel after giving the overall picture of the issue involved, submits that appellant undertakes design, erection and commissioning or installation of telecom towers to various telecom service providers which includes both supply of material and services and raises the invoices per tower basis, discharged sales tax/VAT in terms of composition scheme for tower implementation contracts and his claim has been that they have executed tower implementation work as a composite contract; the adjudicating authority has totally disregarded this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tate Governments. 3.3. It is his further submission that question of interest and penalty would not arise and for the amounts for which they request remand, the question of penalty would not arise there also. 4. Learned departmental representative submits that appellant had rendered taxable services of erection, commissioning and installation services for the period as indicated by the learned counsel, and discharged service tax by availing abatement under Notification Nos.12/2003 and 19/2003 on the gross amount received for the said services in certain cases did not discharge the service tax on the ground that main contractor has discharged the tax liability. He would draw our attention to the Order-in- Original that has confirmed the demands and submits that in respect of erection work of towers, abatement availed by the appellant treating the contract as composite contract of supply machinery is not acceptable in view of the fact that material in that case was supplied by the main contractor and appellant had undertaken services of erection only, whereas the notification prescribes for supply of plant, machinery and equipment for availment of exemption notification. It is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, erection and painting of telecom towers, erection and installation of telecom equipments as a sub-contractor, erection of railway signalling system (railways) or otherwise. It is the case of the revenue that all these services are liable for service tax liability for the period pre and post 01.06.2007. Appellant has been arguing that for the demand raised prior to 01.06.2007 they are unsustainable for the reason that all these contracts have been executed as works contract and duty liability has been discharged availing the benefit of notification 12/2003-ST or 19/2003-ST. 7. On careful consideration of the submissions made by both sides and perusal of records, we find that the services rendered by the appellant as engaged herein above are indeed rendered by the appellant; that the billing is done on erection per tower basis rate; entered into agreements with various telecom service providers and considered the amounts as composite contracts involving supply of material and services and as per their understanding, paid tax after availing abatement of 67% as provided. 8. In respect of the telecom tower installation services, construction of petrol pumps and industrial build ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ithout expressing any opinion and leaving all the issues open, the matter is remitted back to the adjudicating authority to reconsider the issue afresh, after following principles of natural justice. 11. As regards the demand on signalling system erected for railways, post 01.06.2007, we find that the said work has been executed by the appellant under a contract awarded by the railways which has to be considered as works contract and the definition of works contract under Sec.65 (105) (zzzza), excludes from the tax liability, the work executed for railways. Accordingly, the demand raised on the appellant on this issue is held as unsustainable and is set aside. 12. Since, the entire issue involved in this case is of interpretation and covered by the decision of the Apex Court for substantial period and set aside by us, interest and penalties are set aside. However, as regards the interest liability for the amounts which needs to be reconsidered by the adjudicating authority, we leave it to the adjudicating authority to come to an appropriate conclusion, as also in respect of the penalties on those amounts. 13. The appeal stands disposed of as indicated herein above. (Pro ..... X X X X Extracts X X X X X X X X Extracts X X X X
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