TMI Blog2020 (9) TMI 837X X X X Extracts X X X X X X X X Extracts X X X X ..... 2014-ST (by way of substitution). Accordingly, the appellant is entitled to exemption under Notification No. 25/2012-ST, and the demand of ₹ 97,63,710/- is set aside. Liability of service tax on the flats constructed and allocated to the land owner under the development agreement - HELD THAT:- The construction of flats under the development agreement with the land owner by the appellant is on principal to principal basis. In such transaction, there is neither any element of service provided to the land owner, nor any element of sale. Accordingly, we hold that service tax is not imposable on this transaction and accordingly set aside the demand of ₹ 5,55,458/- - demand set aside. Non payment of service tax on trenching works done for GTL Limited - case of appellant is that the Court below failed to appreciate the fact that the said demand is for services rendered during the period 2010-11 whereas the show cause notice have been issued on 09.12.2016 - extended period of limitation - HELD THAT:- The appellant has already provided the service as well as raised the invoice before 30.06.2011. Further, admittedly appellant have not given the option for payment of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Head Amount (Rs) Remarks Works Contract Service 97,63,710/- Exemption not available, Notification No. 25/2012-ST. Site Formation and clearance of earth and demolition 63,973/- Short payment Construction of residential flats 5,55,458/- Short payment Total ₹ 1,03,83,141/- alongwith proposal to impose penalty under Section 78 on the aforementioned demands. 3. The show cause notice was adjudicated on contest and the aforementioned demands were confirmed alongwith penalty of ₹ 1,03,83,141/- under Section 78 of the Act and further penalty of ₹ 10,000/- under Section 77(2) of the Finance Act, 1994. 4. Being aggrieved, the appellant preferred appeal before the Commissioner (Appeals) who was pleased to dismiss the appeal in part upholding the order-in-original, but was pleased to reduce the penalty under Section 78 to 50%. 5. Being Aggrieved, the appellant is before this Tribunal. 6. As rega ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erms of clause (8) (60) of Section 3 of the General Clauses Act, 1897, or local authority in terms of Clause 31 of Section 65B of the Finance Act, 1994. Therefore, there is no legal merit in the claim of the appellant that the service provided by them were to Government or local authority, and hence exemption is not available to them. 9. For further appreciation, we take notice of Sl. No. 12 of Notification No. 25/2012-ST which is as follows:- 12. Services provided to Government, a local authority or a Governmental authority by way of construction, erection, commissioning, installation, completion, fitting out, repair, maintenance, renovation, or alteration of- (a) a civil structure or any other original work meant predominantly for use other than for commerce, industry, or any other business or profession; 10. Further, Governmental Authority have been defined in definition clause 2(s)- Governmental authority means a Board, or an authority or any other body established with 90% or more participation by way of equity or control by Government and set up by an Act of the Parliament or a State Legislature to carry out any function entrusted to a municipality under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n). Accordingly, we hold that the appellant is entitled to exemption under Notification No. 25/2012-ST, and the demand of ₹ 97,63,710/- is set aside. 13. The second issue with regard to liability of service tax on the flats constructed and allocated to the land owner under the development agreement. Learned Counsel urges that admittedly after construction of the residential complex under the development agreement jointly with the land owner, the appellant have part of allocated constructed area to the land owner, after receipt of completion certificate dated 01.11.2013. Further, the appellant as builder have developed the land of the owner as residential complex, on principal to principal basis. There is no element of service provider and service receiver. There is no consideration defined in the builders / development agreement for any service. Thus, the transaction goes out of the purview of service tax. Reliance is placed on the ruling of Delhi Bench of this Tribunal in the case of Bairathi Developers Pvt. Limited -2016 (43) STR 455 (Tri. Delhi). Learned Counsel further urges that the Court below has relied upon Circular No. 151/2/2012-ST dated 10.02.2012 which was issu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vice was completed before 30.06.2011 and the invoices were also issued till that date. Thus, it is the option of the tax payer to treat the date of receipt of payment as the taxable event or not. Admittedly, the appellant in the present case has already booked the receipt/ income in the financial year 2010-11 and therefore there is no question of carry forward of the taxable event beyond 31.03.2011. Thus, the impugned demand is admittedly beyond the extended period of limitation, there has been no exercise of option as such by the appellant. Learned AR for the Revenue further urges that the return for the period April, 2011 to September, 2011 was filed on 12.12.2011, which is the relevant date to recon time, in terms of Section 73(6) of the Finance Act. Thus, the show cause notice was issued well within five years time limit specified under Section 73(4) ibid. He further urges that in fact tax, has to be demanded as on 01.04.2011 but for the provision of Rule 9 ibid, it is demanded based on the date of receipt. 17. Having considered the rival contentions on this issue, we find that appellant has already provided the service as well as raised the invoice before 30.06.2011. Furthe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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