TMI Blog2021 (2) TMI 455X X X X Extracts X X X X X X X X Extracts X X X X ..... ned Counsel for the appellant has demonstrated that these cases were specifically cited before learned Commissioner but no finding has been given as to why they were not being followed. Learned Commissioner, however, sought to distinguish the case of the appellant from the judgement of the Supreme Court in the case of COMMISSIONER, CENTRAL EXCISE CUSTOMS VERSUS M/S LARSEN TOUBRO LTD. AND OTHERS [ 2015 (8) TMI 749 - SUPREME COURT] - In our view, when the applicability of judgement of the Supreme Court in the case of Larsen and Toubro Ltd . to the appellant‟s case has been decided by this Tribunal, judicial discipline required the Commissioner to follow it. He just ignored it. The impugned order is not sustainable and needs to be set aside - Appeal allowed - decided in favor of appellant. - Service Tax Appeal No. 52297 of 2019 - FINAL ORDER NO. 51038 /2021 - Dated:- 27-1-2021 - MR. DILIP GUPTA, PRESIDENT AND MR. P V SUBBA RAO, MEMBER (TECHNICAL) Shri Narender Singhvi, Advocate for the Appellant Shri A. Thaplial, Authorised Representative for the Department ORDER This appeal is filed by the appellant assailing Order-in-Original No. RPR/EXCUS ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he charge was introduced on Works contract Service . Prior to this date, service tax was being levied on the service component of composite works contact after giving abatement through various notifications towards the goods component of the contract. The Hon'ble Supreme Court has held that Works contracts are a separate specie of contract known to trade as has been held in the case of Gannon Dunkerley [1193 (1) SCC 364] by the Supreme Court and, therefore, they can be treated only as such and not as Service contract. Prior to introduction of the work contracts, no service tax can be levied on Works contracts under any head. Service tax could be levied only on the services simplicitor. From June 01, 2007, when the service tax was introduced on Works contract, service tax could be charged only under this head because the position with respect to the charges under other heads such as CICS, ECI and CE services has not changed even after June 01, 2007. 4. He submits that in the impugned order, the learned Commissioner has held that the decision of the Hon'ble Supreme Court in the case of Larsen and Toubro Ltd. (supra) is not applicable as their contracts are not indi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l)] (in respect of SCN dated 19.07.2002). 7. He takes the Bench through Order-in-Original to show that the learned Commissioner has not followed the ratio of the decision by this Tribunal nor has he given any reasons for not doing so. Learned Commissioner has distinguished this case from the judgement of Hon‟ble Apex Court in the case of Larsen Turbo (supra) as follows: 5.13 From the aforesaid judgement, it is evidently clear that, Hon‟ble Supreme Court is not of the opinion that service tax is not chargeable in case of works contract but it sates that the service tax cannot be in any way, applicable in case of sale / supply of goods covered under the said contracts. The judgement repeatedly refers to indivisible work contracts which means the contract in which the service portion and the sale portion are not separable, and the value of service cannot be arrived at without harming the value of sale. 5.14 In the instant case, I have perused the copies of summary price schedules relied upon in the Show Cause Notice and the copy of Annexure to SCN enclosed by the department. These documents clearly indicate the bifurcation of value of the goods supp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are mentioned separately. This question has been answered in respect of their own contracts by the Tribunal for the earlier period in their favour. Therefore, the Commissioner should not have confirmed the demand without following the binding judicial precedent. Therefore, the entire demand is to be set aside along with interest under section 75 and penalties under sections 76 and 78. 9. Learned Departmental Representative strongly supports the Order-in-Original and asserts that service tax can be charged on the service component since this contract, though on turnkey basis, has clearly earmarked amounts towards supply of goods and rendition of services. 10. We have gone through the records of the case and considered the submissions made by both the sides. The contracts in question are contracts entered into between the Steel Authority of India Ltd. / Bhilai Steel Plant and a consortium comprising the appellant and three other contractors. The role and responsibility of each contractor is individually indicated. Clauses (a) and (b) of the contracts read as follows: (a) The Employer has decided to set-up installation of Long Rail Finishing Line comprising of Roll Tavles, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion, commissioning, etc. along with supplies of various machines and equipments. The Commissioner (Appeals) has set aside the demands for the reason that the contracts executed are in the nature of Works contract which cannot be vivisected to distinguish those activities, which can be identified as taxable services. The argument of the Revenue is that the works assigned to the assessee in these contracts are separately identifiable and quantifiable in each contract. From the records, it may be seen that separate invoices and documents are available for supplies and services. From these documents it is possible to ascertain the value of taxable services separately for various services, such as design, erection, commissioning, testing, etc. in view of the above. Revenue‟s contention is that the various activities executed by the assessee are to be individually classified into various categories of services and liable to payment of service tax. 7. Works contract as a species have been included in the statute book for the purposes of levy of service tax with effect from 01.06.2007. The demands raised in the present case are prior to 01.06.2007 and have been made by vivisecti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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