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TMI Blog2025 (4) TMI 765X X X X Extracts X X X X X X X X Extracts X X X X ..... tna, it was noticed that the appellant had provided taxable services falling under the category of construction of residential complex services [as defined under section 65(105)(zzzh)] read with section 65(30a), construction service(commercial or industrial) [as defined under section 65(105)(zzzq)] read with section(25b) and site formation service [as defined 65(105)(zzza)] read with section 65(97a) of the Finance Act, 1994, as the appellant entered into a contract for completion of work of "construction of boundary wall, security room, main gate at 132/133 KV sub-station at Naugachhia, Raxaul, Runnisaiadpur & GOH associated with Bihar Sub-Transmission System(Phase-2), Part-2" & "Construction of Residential quarters at GOH & Runnisaiadpur". As per Letter of Award (LAO) indicating details of payment made by Power Grid Corporation of India Limited, Patna to the appellant, the department inferred that the services rendered by the appellant, fall under the categories aforesaid and the appellant was liable to pay Service Tax thereon for the period 2009-2010, 2010-2011 collectively amounting to Rs.32,84,864/- on the taxable amount of Rs.3,18,91,876/- received by the appellants. A Show Ca ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . It is observed that the lower authority however did not accept the appellant's plea and held that as a sub-contractor they were liable to pay service tax, subject to availability of the credit to the main contractor and accordingly confirmed a service tax demand of Rs.10,84,005 along with interest besides imposing penalties under sections 76, 77 & 78 of the Finance Act on the appellants. In appellate proceedings the Commissioner (Appeals) while dismissing the appellant's appeal accepted the department's appeal proposing to levy penalty @ Rs.200/- per day for delay in Service Tax Registration, besides imposing a late fee of Rs.20,000/- per return. It is seen that the Ld. Commissioner had not accepted the appellant's plea and held that the service rendered by the appellant were taxable irrespective of whatever category it would fall under. 7. It is noted that in respect of Construction Services the Board's Circular No.80/10/2004 dated 17.09.2004 in Para-13.2 clearly mentions that government buildings or civil constructions as are used for residential, office purposes or for providing civic amenities etc. would not be taxable unless such constructions were for commercial purposes l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Nature of Work 1.I/F-347/LOA-77 dated 18.09.2009 Construction of Boundary wall, Security Room and Main gate for 132/33 KV GOH Sub-Station associated with Bihar Sub-Transmission System Phase-2, Part-2. 2.I/F-366/LOA-93 dated 01.12.2009 Construction of Boundary wall and Main gate for 132/33 KV Sub-Station at Dalsingh Sarai associated with Bihar Sub-Transmission System Phase-2, Part- 2(PKG-G). 3.I/F-382/LOA-104 dated 22.04.2010 Construction of Quarters and associated services for 132/33 KV Runnisaidpur Sub-Station associated with Bihar Sub-Transmission System Phase-2, Part-2. 4.I/F-391/LOA-108 dated 28.06.2010 Construction of Boundary wall, Security Room and Main gate for 132/33 KV Runnisaidpur Sub-Station associated with Bihar Sub-Transmission System Phase- 2, Part-2. 5.I/F-311/LOA-75 dated 20.07.2009 Construction of Boundary wall, Security Room and Main gate for 132/33 KV Sub-Station at Naugachhiya and Raxaul associated with Bihar Sub- Transmission System Phase-2, Part-1. It is evident from the above table that the scope of work in as many as 4 of the LOA's relate to construction of the infrastructure for the power station while one relates to provisioning of the reside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the taxability would get decided accordingly. 3. However, it is also apparent that in case the services provided by the sub-contractors to the main contractor are independently classifiable under WCS, then they too get the benefit of exemption so long as they are in relation to the infrastructure projects mentioned above. Thus, it may happen that the main infrastructure projects of execution of works contract in respect of roads, airports, railways, transport terminals, bridges, tunnels and dams, is sub-divided into several sub-projects and each such subproject is assigned by the main contractor to the various subcontractors. In such cases, if the sub-contractors are providing works contract service to the main contractor for completion of the main contract, then service tax is obviously not leviable on the works contract service provided by such sub-contractor. 13. It is not disputed that the services so rendered was to BSEB though the order was placed on the appellant by Power Grid Corporation India Limited, Patna, and the payment for the service rendered by the appellant was tendered by PGCIL only. Thus, for all practical practices, PGCIL indeed is the service provider an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rst place there was no liability to pay Service Tax on part of the appellant. The appellant obtained Service Tax Registration No.AADCC0435DSD001, for providing taxable service falling under the category of 'construction service'(commercial and industrial) defined under Sec.65(25b) of the Finance Act, 1994. Sec.65(25b) of the Act ibid outlines the scope of 'commercial or industrial construction services'. They have also classified the services provided under the category of 'construction of residential complex' services as covered by Sec.65(30a) and site levelling and slope protection works undertaken by the appellant falling under the category of 'site formation and clearance, excavation and earth moving and demolition service' covered under Sec.65(105)(zzza) of the said Act. It cannot be disputed that the service discharged is actually covered by construction of complex service ( Sec.65(30a) ibid, as to: "Construction of complex" means- (a) Construction of new residential complex or a part thereof; or (b) Completion and finishing services in relation to residential complex such as glazing, plastering, painting, floor and wall tilling, wall covering and wall preparing, wood a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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