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TMI Blog2021 (2) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... nterest. 2. The appellant claims to be engaged in providing services relating to construction, consultancy, maintenance and repair, management, execution of projects relating to power and transport sectors. It entered into an agreement with M/s Gautami Power Pvt. Ltd. [Gautami] for undertaking the design, engineering, construction, installation, testing and commissioning of a "combined cycle gas turbine facility" [Gas Facility] in Andhra Pradesh. The appellant further claims that in order to execute a portion of the "civil work" of aforesaid agreement, it appointed M/s Nagarjuna Construction Company as a contractor. The said civil work was further sub-contracted to M/s Ganon Durkekrley & Co. Ltd. and M/s R.R. Services. The appellant discha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant utilized credit for payment of service tax on output CICS, which was in violation of the conditions of the Notification. Further, there is no distinction between wrongful availment and wrongful utilization of credit; and c. That the appellant could not establish that the input services, in respect of which credit has been availed and utilized, were used specifically for rendering taxable output services, other than the output service of CICS rendered to Gautami. 6. Shri B.L. Narasimhan, learned counsel appearing for the appellant made the following submissions : (i) The activities of the appellant constitute a composite contract involving goods and services. Composite contracts are taxable under the category of "works ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t would determine whether it was a composite contract imposing goods and service. The relevant Article 2.1 of the agreement is reproduced below : "Except as otherwise expressly set forth in this agreement, contractor shall perform or cause to be performed all services required in connection with the design, engineering, construction, commissioning, start-up, demonstration and testing of the Facility (the 'services' on a lumpsum fixed price basis in accordance with provisions of this agreement as follows : (i) all engineering and design services required for a completely engineered facility; (ii) port of entry clearance and handling services in Indian and inland transportation from the relevant point of delivery by Owner's supplier under t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , Commissionerate, Raipur [2020(12) TMI 1015 - CESTATE New Delhi] in view of the decision of the Gujarat High Court in Messrs NJ Devani Builders Pvt. Ltd. Vs. Union of India [2020(11) TMI 798 - Gujarat High Court]. 12. The relevant portion of the decision of the Tribunal is reproduced below : "27. The contention of the learned Authorized Representative of the Department is that since the appellant registered itself under the head of CIC or ECI, it cannot now contend that the services rendered by it would be classified under 'works contract' service. 28. This contention cannot be accepted in view of the decision of the Gujarat High Court in M/s. N J Devani Builders Pvt. Ltd. vs. Union of India. The High Court observed as follows: "5.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... petitioner cannot be fasten its liability to pay service tax on the services rendered by it as 'work contract' services. 6.5. Considering the aforesaid amendment in the Finance Act, 1994, the Supreme Court in the case of L & T Ltd. (supra), after considering the decision of the Supreme Court in the case of Gannon Dunkerley reported in (1993) 1 SCC 364 = 2002-TIOL-103-SC-CT-CB held that the separation of the value of the goods contained in the execution of a works contract will have to be determined by working from the value of the entire works contract and deducting there from charges towards labour and services. The Apex Court therefore was of the opinion that the service tax charging Section itself must lay down with specificity ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e adjudicating authority to verify the applicability of the notification dated 01.03.2006, though, admittedly the petitioner was not liable to pay the service tax prior to 01.06.2007, as the petitioner was rendering services of 'works contract'. 8. The contention raised on behalf of the respondents that as the petitioner had voluntarily registered under the head of 'commercial /industrial construction services', the petitioner is liable to pay service tax, is not tenable as the petitioner cannot be held to be liable to pay service tax prior to 01.06.2007, where, it is not in dispute that the petitioner was rendering 'works contract service'." (emphasis supplied) 13. Thus, for the reasons stated above, the confirm ..... X X X X Extracts X X X X X X X X Extracts X X X X
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