TMI Blog2023 (1) TMI 690X X X X Extracts X X X X X X X X Extracts X X X X ..... atter there is no dispute on the facts that the Appellant is Commissioning and Installation agency and for providing the taxable services appellant has provided the thermal insulating materials i.e. Hot insulation including supply of LRB and Aluminium Sheet, Cold insulation with Thermocol and Aluminium Sheet, Insulation of Pipeline with black superion sleeve providing and fixing of black superion with cellotape , insulation with black nitrile rubber foam, sheet, etc. and on supply of goods appellant also paid sales tax/ VAT. Hence, the Appellant are eligible to the benefit of the Notification No. 1/2006-S.T., dated 1-3-2006. Wrong classification of service under Works Contract Service - HELD THAT:- From the definition of Works Contract Service, it is clear that only specified categories of works contract are considered for levy of Service Tax under the said definition. These are enumerated in clauses (a) to (e). It is found that in clause (a) thermal insulation also mentioned and in the present matter appellant had also paid VAT/ sales tax on goods which is used in installation of thermal insulation. The impugned activity of the assessee was nothing but works contract service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ervice of Rs. 24,37,017/- for wrong classification of service and to impose penalty. The matter was adjudicated and the demand of service tax was confirmed along with interest and penalty was imposed. Against this order, the appellant is before us. 03. Shri Anil Gidwani, learned Counsel the appellant submits that there is no dispute over the fact that the Appellant was undertaking erection, installation and commissioning work , wherein thermal insualting material such as (i) Hot insulation including supply of LRB and Aluminium Sheet (ii) Cold insulation with Thermocol and Aluminium Sheet (iii) Insulation of Pipeline with black superion sleeve providing and fixing of black superion with cellotape (iv) insulation with black nitrile rubber foam, sheet, etc. were being supplied and applied on the equipment, structures etc. The sale price of the material was not being separately shown in the invoice, however, substantial VAT/Sales Tax under appropriate scheme and at appropriate rates were paid. In fact, the approx.. involvement of material in the work undertaken is about 70% of the total cost. There is no dispute over this fact, and this was also specifically mentioned in the statem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ales Tax Laws and that the appellant also paid Sales Tax/ VAT on material consumed during the execution of such work in dispute. The CBEC has clarified in its circular No. B1/16/2007-TRU dated 22.05.2007 that all those contracts which qualifies works contract under the Sales Tax Laws equally qualify as work contract for the purpose of levy of Service tax. This is also clear from the definition of taxable service for works contract as appearing at Section 65(105)(zzzza) of the Finance Act, 1994. That the work undertaken by the appellant not only attract VAT/Sales Tax, but are also qualified as works contract . The strange reasoning adopted in the impugned order to hold that there is no transfer of property on goods involved in execution of works is not legally acceptable. The Appellant is also registered under works contract services and discharging service tax accordingly since long and no further proceedings have been undertaken against them for the same nature of work where they regularly discharge service tax liability under works contract service. 3.5 Without prejudice, he also submits that in any case benefit under Notification 12/2003-ST is available to the Appellant. H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld not be available to appellant as the condition laid down in the said Notification are not fulfilled by appellant. However, we find that in above column (4) of the table which is related to the condition in explanation it clearly used the words and any other material sold by the commissioning and installation agency, during the course of providing erection, commissioning or installation service . Hence, in our opinion, it cannot be considered that the said entry is applicable only on the supply of plant, machinery or equipment or structures. Besides, it is also applicable on any other material soLearned In the present matter there is no dispute on the facts that the Appellant is Commissioning and Installation agency and for providing the taxable services appellant has provided the thermal insulating materials i.e. Hot insulation including supply of LRB and Aluminium Sheet, Cold insulation with Thermocol and Aluminium Sheet, Insulation of Pipeline with black superion sleeve providing and fixing of black superion with cellotape , insulation with black nitrile rubber foam, sheet, etc. and on supply of goods appellant also paid sales tax/ VAT. Hence, in our opinion, the Appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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