TMI Blog2022 (1) TMI 393X X X X Extracts X X X X X X X X Extracts X X X X ..... mpliciter and that it is only w.e.f 01.06.2007 that section 65(105)(zzzza) was introduced to cover composite works contract and so works contract cannot be covered under any other category of services prior to 01.06.2007. It is, therefore, clear from the aforesaid judgment of the Supreme Court in Larsen Toubro that a composite works contract cannot be taxed under construction services under section 65(30a) or under commercial or industrial construction service under section 65(25b) of the Finance Act, prior to 01.06.2007 as the scope is limited to cover contract of service simplicitor only - Even post 01.06.2007 service tax could not have been confirmed under works contract service. The show cause notice alleged that the appellant was providing construction services or commerical or industrial construction service and the demand has also been confirmed under this category by the adjudicating authority. The impugned order, therefore, deserves to be set aside for post 01.06.2007 period also since the demand made under a particular category of service found to be incorrect in a subsequent proceeding, cannot be sustained. It is not necessary to examine the conten ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5. Shri C. Sumanth, learned counsel for the appellant made the following submissions: (i) The services rendered by the appellant were works contract service and leviable to tax after 01.06.2007 under section 65(105)(zzzza) of the Finance Act. Thus, they could not be subjected to levy of service tax prior to 01.06.2007. In support of the contention, learned counsel placed reliance upon the judgment of the Supreme Court in Commissioner of Central Excise Customs, Kerala vs. Larsen Toubro Ltd.[ 2015 (39) STR 913 (SC) ]; (ii) Service tax is not leviable even for the period post 01.06.2007 and so the same is also liable to be set aside. The contention is that once it is held to be a works contract prior to 01.06.2007, the demand under the category of construction service or commercial or industrial construction service would not survive for the reason that the demand was not made under the category of works contract ; and (iii) The extended period of limitation could not have been invoked and interest and penalty could not be imposed. 6. Shri C. Mallikarjun Reddy, learned authorized representative appearing for the Department ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... curement and construction or commissioning (EPC) projects; 10. Thus, service tax could only have been demanded on works contract services after introduction of a charge on a works contract service and not under any other head. This is what was observed by the Supreme Court in Larsen Toubro. The Supreme Court examined as to whether works contract service can be classified under section 65(105)(zzzh) as construction of complex service and held that the scope of section 65(105) (zzzh) is limited to cover contract of service simplicitor only and not a composite works contract . The Supreme Court noticed that a works contract is different from a contract for service simpliciter and that it is only w.e.f 01.06.2007 that section 65(105)(zzzza) was introduced to cover composite works contract and so works contract cannot be covered under any other category of services prior to 01.06.2007. The relevant portion of the judgment is reproduced below : 15. A reading of this judgment, on which counsel for the assessees heavily relied, would go to show that the separation of the value of goods contained in the execution of a works contract will have to be determined ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... We find that the assessees are correct in their submission that a works contract is a separate species of contract distinct from contracts for services simpliciter recognized by the world of commerce and law as such, and has to be taxed separately as such. ******* 24. A close look at the Finance Act, 1994 would show that the five taxable services referred to in the charging Section 65(105) would refer only to service contracts simpliciter and not to composite works contracts. This is clear from the very language of Section 65(105) which defines taxable service as any service provided . All the services referred to in the said sub-clauses are service contracts simpliciter without any other element in them, such as for example, a service contract which is a commissioning and installation, or erection, commissioning and installation contract. Further, under Section 67, as has been pointed out above, the value of a taxable service is the gross amount charged by the service provider for such service rendered by him. This would unmistakably show that what is referred to in the charging provision is the taxation of service contracts simpliciter and not composite w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pportunity of meeting the precise case made out by the Revenue. 14. This is what was also observed by the Supreme Court in Reckitt Colman of India Limited vs. Collector of Central Excise [ 1996 (88) ELT 641 (SC) ] of India in paragraph 3 of the judgment which is reproduced below : 3. It will be remembered that the case of the Revenue, which the appellant had been required to meet at every stage from the show cause notice onwards, was that the said product was a preparation based on starch. Having come to the conclusion that the said product was not a preparation based on starch, the Tribunal should have allowed the appeal. It was beyond the competence of the Tribunal to make out in favour of the Revenue a case which the Revenue had never canvassed and which the appellants had never been required to meet. It is upon this ground alone that the appeal must succeed. 15. Thus, for all the reasons stated above, the order dated 30.03.2010 passed by the Commissioner, cannot be sustained. 16. In view of the aforesaid, it is not necessary to examine the contention raised by learned counsel for the appellant relating to the demand being barred by limita ..... X X X X Extracts X X X X X X X X Extracts X X X X
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