TMI Blog2023 (10) TMI 1088X X X X Extracts X X X X X X X X Extracts X X X X ..... MMISSIONER OF GST CENTRAL EXCISE, CHENNAI [ 2018 (9) TMI 1149 - CESTAT CHENNAI] held that the demand of service tax under Construction of Residential Complex Service cannot sustain when the nature of construction activities rendered are of composite contracts involving both materials and labour. The said decision was followed in JM/S. JAIN HOUSING CONSTRUCTION LIMITED VERSUS COMMISSIONER OF SERVICE TAX, CHENNAI [ 2023 (2) TMI 1044 - CESTAT CHENNAI] . Thus, the demand for the subsequent period 2007-2008 to 2009-2010 also cannot sustain and requires to be set aside - appeal allowed. - HON BLE MS. SULEKHA BEEVI C.S., MEMBER (JUDICIAL) And HON BLE MR. VASA SESHAGIRI RAO, MEMBER (TECHNICAL) For the Appellant : Shri. J. Shankar Raman, Advocate For the Respondent : Shri. N. Satyanarayanan, Assistant Commissioner Commissioner ORDER Order : Per Ms. SULEKHA BEEVI C.S. The appellant is engaged in providing Construction of Residential Complex for Tamil Nadu Police Housing Corporation, Vellore. The Department was of the view that the appellant is liable to pay Service Tax on the amounts received from Tamil Nadu Police Housing Corporation for the construct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ] were relied. The ld. counsel prayed that the appeal may be allowed. 4. The Ld. Authorized Representative Shri N. Satyanarayanan appeared and argued for the Department. Paragraph 9 of the impugned order was adverted to by the Ld. AR to argue that the appellant is a sub-contractor and the construction activities have been provided to the Tamil Nadu Police Housing Corporation and therefore would be covered by the definition. It is prayed that the appeals may be dismissed. 5. Heard both sides. 6. The issue is whether the demand raised under construction of residential complex service is legal and proper. 7. In appeal No. ST/41303/2014, the demand is raised for the period prior to 01.06.2007. The Hon ble Apex Court in the case of Larsen Toubro (supra) has categorically held that the demand of Service Tax on construction activities which include the element of supply of goods as well as labour / services cannot be subject to levy of Service Tax prior to 01.06.2007. Following the same, we are of the view that the demand for this disputed period the demand cannot sustain and requires to be set aside. Ordered accordingly. 8. In appeal No. ST/41650/2016, the demand is for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eld that the demand cannot sustain. 11. In the case of Siva Engineering Company (supra), a similar issue was considered and the Tribunal held as under:- 6.3. The said decision was followed by the Tribunal in the case of Lanco Tanjore Power Co Ltd. (supra) wherein the Tribunal discussed as under: 7. Construction of residential complex activity was carried out by the assessee for M/s. Lanco. It is submitted that such residential units were constructed for use as quarters of the employees of M/s. Lanco. It is evident from the facts of the case that M/s. Lanco has engaged the assessee with the specific purpose of construction of such residential units which are meant for personal use of the employees of M/s. Lanco We extract below the statutory definition of section 65(91a) of the Finance Act, 1994: Residential complex means any complex comprising of (i) a building or buildings, having more than twelve residential units; (i) a common area; and (ii) any one or more of facilities or services such as park, lift, parking space, community hall, common water supply or effluent treatment system, located within a premises and the layout of such premises is approved by an authorit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t case) enters into a Contract for construction of a Residential Complex‟ with the Promoter/Builder/Developer (M/s. Nithesh Estates Limited in the present case) which itself provides service of Design, Planning and Construction and after such construction, the ultimate owner receives such property for Personal use‟, then such activity would not be subjected to Service Tax, because this case would fall under the Exclusion Clause‟ provided in the definition of Residential Complex‟. 20. However, in such a situation, if the Service of any person like the Contractor or a similar Service Provider (M/s. Larsen Toubro Limited in the present case) is received, then such a person (M/s. L T Limited, in the present case) would be liable to pay the Service Tax. 21. In view of this clear position of law indicated by the C.B.E. C. itself, we are of the considered opinion that the Revenue cannot be allowed to argue against the legal position rightly explained by the C.B.E. C. itself which can certainly be invoked and applied by this Court for interpreting the provisions of law on the principles of interpretation of Contemporenea Expositio and the Centr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come to the conclusion that no substantial question of law would really arise in the present case including the question of extended period of limitation under Section 73(1) of the Finance Act, 1994. When the levy of Service Tax on the respondent Assessee itself is held to be illegal, the question of availability of extended period of limitation for levying such Service Tax does not arise. 13. The Tribunal in the case of M/s. Real Value Promoters Ltd. v. Commissioner of G.S.T. and Central Excise, Chennai ors. vide Final Order No. 42436-42438/2018 dated 18.09.2018 held that the demand of service tax under Construction of Residential Complex Service cannot sustain when the nature of construction activities rendered are of composite contracts involving both materials and labour. The said decision was followed in Jain Housing Ltd. v. Commissioner of Service Tax, Chennai vide Final Order Nos. 40077-40079/2023 dated 24.02.2023. The Department filed appeal against such order and the appeal was dismissed by Hon ble Apex Court vide judgment dated 24.02.2023. 14. From the above, we are of the opinion that the demand for the subsequent period 2007-2008 to 2009-2010 also cannot susta ..... X X X X Extracts X X X X X X X X Extracts X X X X
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