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TMI Blog2018 (10) TMI 1207X X X X Extracts X X X X X X X X Extracts X X X X ..... struction of residential complex service in their various projects. During visit, the Preventive Officers resumed various records including rough register and rough ledger. Appellants have been maintaining proper records like issuance of a receipt to the customer maintenance of accounts on tally software. All receipt from customers are shown as project receipt in the Balance Sheet. Besides above, there is an account called project refund which refers to receipt from various persons as refundable loan. On the basis of rough register and rough ledger, show cause notice was issued proposing to demand service tax Rs. 1,28,54,902/- and to appropriate Rs. 76,88,206/- already paid by appellants. The Commissioner dropped the demand on account of am ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lhi-I Vs. GOLDY ENGINEERING WORKS 2013 (289) E.L.T. 418 (Raj.) CCE, Jaipur-I Vs. NIRMAL BHANDARI 2008 (230) E.L.T. 81 (Tri.-Del.) CCE, Jaipur-I Vs. SUMETCO ALLOYS PVT. LTD. 2010 (19) S.T.R. 242 (Tri.-Ahmd.) Commissioner ST Vs. PURNI LTD. 2009 (247) E.L.T 223 (Tri.-Ahmd.) CCE, Surat Vs. TULSI PVT. LTD. B During the relevant period, there being no machinery provision, service tax on construction of residential complex service was not payable. Reliance has been placed on Delhi High decision in the case of Suresh Kumar Bansal 2016 (43) S.T.R. 3. C Service Tax cannot be demanded on the amount Rs. 28535980/- received as loan - service tax involved Rs. 7.35 lac (approx.) (i) The Commissioner's observation are given in para 34(b) & para 34( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are said to have made the said payments nor the author of the said register/ledger has been examined. F Appellants are eligible for benefit of cum tax price under Section 67(2) (tax involved Rs. 2.37 lacs). G Extended period of limitation cannot be invoked. H In view of the provision of Section 73(3) of Finance Act, 1994, even show cause notice was not required to be issued to the extent it relates to demand of service tax Rs. 7688206/-. I Penalty under Section 70, 77 & 78 is not imposable. 5. Learned AR relied on the impugned order and reiterated the findings of learned Commissioner's. 6. Having considered the rival contentions, so far as the demand of Rs. 12,64,097/- is concerned, we find that such demand has been raised on the basi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 05,000/-. In this view of the matter, we hold that no penalty was impossible on the appellant under Sections 70, 77 and 78 of the Act. Accordingly, we set aside all the penalties. We further take a note of the ruling of Hon'ble Delhi High Court in the case of Suresh Kumar Bansal vs. Union of India reported at 2016 (43) STR 3 (Del.) wherein the Writ Petition was decided on 3rd June, 2016 with respect to taxability of construction complex intended for sale by builders in the context of Section 65(105)(zzzh)of the Finance Act, 1994 read with explanation added by Finance Act, 2010 wherein by legal fiction the scope of taxable service was extended. The Hon'ble High Court held that it was levy ultra vires as there was no statutory mechanism to as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per. Levying a tax on the constituent goods or th eland would clearly intrude into the legislative field reserved for the States under List-II of the Seventh Schedule to the Constitution of India. 39. In the present case, we find that there is no machinery provision for ascertaining the service element involved in the composite contract. In order to sustain the levy of service tax on services, it is essential that the machinery provisions provide for a mechanism for ascertaining the measure of tax, that is, the value of services which are charged to service tax. 43. For the purpose of ascertaining the value of services, the Central government has made Service Tax (Determination of Value) Rules, 2006 (hereafter 'the Rules'). However none ..... X X X X Extracts X X X X X X X X Extracts X X X X
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