TMI Blog2023 (5) TMI 526X X X X Extracts X X X X X X X X Extracts X X X X ..... eld that the said taxable services referred only to service contracts simpliciter and not to composite works contracts. Admittedly, the challenge raised by the petitioner to the validity of Section 65(105)(zzzq) and (zzzh) of the Act is squarely covered by the decision of the Supreme Court in Commissioner, Central Excise and Customs, Kerala v. Larsen and Toubro Limited. - In view of the law laid down by the Supreme Court in Commissioner, Central Excise and Customs, Kerala v. Larsen and Toubro Limited, the impugned order, which proceeds on the basis that composite contracts involving transfer of goods as well as services were covered under the taxable services under Section 65(105)(zzzq) and (zzzh) of the Act, cannot be sustained. Matt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... andamus or any other appropriate Writ/ order/ direction declaring that the Parliament is not competent to levy service tax on works contract per se, hence, construction activity both commercial residential using the materials (works contract) per se are not liable to service tax under the provisions of Chapter V of the Finance Act, 1994; 2. It is the petitioner s case that it is not liable to pay any service tax either under Clause (zzzh) of Sub-section (105) of Section 65 of the Finance Act, 1994 (hereafter the Act ) or under Clause (zzq) of Sub-section (105) of Section 65 of the Act on the works executed by it pursuant to the composite contracts entered into for construction of residential/commercial flats. 3. The petitioner co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ended by the Finance Act, 2007 by introducing Clause (zzzza) with effect from 01.06.2007 to include services in relation to execution of a works contract . Admittedly, composite contracts are covered under taxable services under Section 65(105)(zzzza) of the Act. However, the Adjudicating Authority has held that it was not permissible for the petitioner to reclassify its services as works contract under Clause (zzzza) of Sub-section (105) of Section 65 of the Act and the services rendered by the petitioner would continue to be classified under Section 65(105)(zzq) and Section 65(105)(zzzh) of the Act. 7. The petitioner was registered under the provisions of the Act for payment of service tax under the category of construction of comple ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ority [Commissioner (Adjudication), Service Tax, New Delhi] passed the order-in-original dated 28.03.2012 holding (a) that the activities of the petitioner constitute construction of complex services and are taxable under Sub-section (30a) of Section 65 of the Act read with Section 65(105) (zzzh) and therefore, is liable to pay service tax from 16.06.2005. (b) that the switching over of the petitioner to the works contract category after 01.06.2007 was in gross violation of the classification provisions of the Act (c) The petitioner could not exercise the option to pay service tax under Rule 3(1) of Works Contract (Composition Scheme for payment of Service Tax) Rules, 2007 for the ongoing composite contract. 11. Acco ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 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 works contracts, such as are contained on the facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bro Limited (supra). 13. In view of the law laid down by the Supreme Court in Commissioner, Central Excise and Customs, Kerala v. Larsen and Toubro Limited (supra), the impugned order-in-original dated 28.03.2012, which proceeds on the basis that composite contracts involving transfer of goods as well as services were covered under the taxable services under Section 65(105)(zzzq) and (zzzh) of the Act, cannot be sustained. 14. Accordingly, we set aside the impugned order-in-original 28.03.2012 and remand the matter to the Adjudicating Authority to adjudicate the show cause notices afresh in light of the law laid down by the Supreme Court in the case of Commissioner, Central Excise and Customs, Kerala v. Larsen and Toubro Limited (supr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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