TMI Blog2019 (3) TMI 979X X X X Extracts X X X X X X X X Extracts X X X X ..... mmercial purpose. The plain meaning of definition of Commercial or industrial construction service, as can be understood from the definition clause, more particularly, the clarification contained in clauses (i), (ii), (iii) is that the construction ipso facto is not leviable to service tax, but it is only when it is used, or to be used, primarily for commerce or industry or work intended for commerce or industry that service tax can be levied. Thus, it is only that construction which is to be used or primarily to be used for commerce that is subject to levy of service tax. In the present facts, the dominant user of the sports complex is non commercial. The definition uses the words used or to be used primarily for commerce or industry clearly indicating that the user is to be exclusively for commercial purpose or at least it must be primarily for commercial purpose. The definition leaves us in no manner of doubt that if the predominant user of the sports stadium is not commercial, then the same cannot be subjected to levy of service tax - Thus, in the facts of the present case, though an area to the extent of 1/3rd is used for commercial purpose prescribing separa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Service Tax, Pune III who vide his order in original dated 15/09/2011, confirmed the demand, levied interest under Section 75 of the Finance Act and also imposed penalty equal to the service tax evaded by the respondent under Section 78 of the Finance Act. The respondent was informed that if the payment is made within 30 days of the communication of the order, the penalty shall be reduced by 25%. 4. Against the order in original passed by the Commissioner of Central Excise dated 15/09/2011, the respondent preferred an Appeal before the CESTAT. The CESTAT was allowed the Appeal of the respondent holding that the construction is non commercial and therefore no service tax is payable. According to CESTAT the construction is not 'commercial or industrial construction services' within the meaning of the Act. 5. Learned Counsel for the Revenue would urge that the Tribunal committed an error in not appreciating the fact that 1/3rd of the area of the stadium is utilized for commercial purpose, other than sports, and hence, the construction comes within the scope of 'commercial and industrial construction'. Learned Counsel urged that the Tribunal ought to have a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... STAT and the findings recorded therein. Learned Counsel made submissions in support of the impugned order. He invited our attention to the definition of the term 'commercial or industrial construction services' is defined under Section 65(25b) of the Finance Act, 1994. In his submission, the construction of Shiv Chhatrapati Sports Complex cannot be regarded as 'commercial or industrial construction' with the meaning of the the definition under Section 65(25b) of the Finance Act, 1994. Learned Counsel would submit that the plot of land on which the stadium is constructed is owned by the Government of Maharashtra. The record would indicate that the said plot is for public welfare use and not for residential or commercial purpose. Learned Counsel invited our attention to the affidavit dated 09/09/2008 of the Director, Directorate of Sports and Youth Services, Pune where he deposed about holding of 3rd Commonwealth Youth Games 2008 and also a declaration that the stadium will be continued to be used for non commercial purposes even after the Commonwealth Youth Games are over. Learned Counsel also relied on the Circular issued by the Board dated 17/09/2004 wherein it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ) completion and finishing services such as glazing, plastering, painting, floor, and wall tiling, wall covering and wall papering, wood and metal joinery and carpentry, fencing and railing, construction of swimming pools, acoustic applications or fittings and other similar services, in relation to building or civil structure; or d) repair, alteration, renovation or restoration of, or similar services in relation to, building or civil structure, pipeline or conduit, which is i) used, or to be used, primarily for; or ii) occupied, or to be occupied, primarily with; or iii) engaged, or to be engaged, primarily in, commerce or industry, or work intended for commerce or industry, but does not include such services provided in respect of roads, airports, railways, transport terminals, bridges, tunnels and dams; 13. There is no dispute that the plot of land on which the stadium is constructed is owned by Government of Maharashtra. The record maintained by the local authorities would indicate that the plot is for public welfare use and not for residential or commercial purpose. The question that arises for consideration is whether, user of the stadium area to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or to be used, primarily for commerce or industry or work intended for commerce or industry that service tax can be levied. Thus, it is only that construction which is to be used or primarily to be used for commerce that is subject to levy of service tax. 17. In the present facts, we find that dominant user of the sports complex is non commercial. The definition uses the words used or to be used primarily for commerce or industry clearly indicating that the user is to be exclusively for commercial purpose or at least it must be primarily for commercial purpose. The definition leaves us in no manner of doubt that if the predominant user of the sports stadium is not commercial, then the same cannot be subjected to levy of service tax. Thus, in the facts of the present case, though an area to the extent of 1/3rd is used for commercial purpose prescribing separate rates for such user, this by itself is not sufficient to attract service tax. 18. Even the circulars issued by the Board dated 17/09/2004 and 10/02/2012 would indicate that only if such constructions are for commercial purposes, like, local government bodies constructing shops for letting them out, such act ..... X X X X Extracts X X X X X X X X Extracts X X X X
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