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TMI Blog2025 (5) TMI 158X X X X Extracts X X X X X X X X Extracts X X X X ..... al shops, and development of land in lieu of development charges from the owner of the land, under different projects. The assessee was registered since 2011 for providing construction of residential complex services and construction services other than residential complex including commercial/industrial complex. However, no Service Tax was paid for the period January 2013 to October 2016. During an enquiry by the officers of the department, it was noticed that the assessee had discharged his service tax liability in respect of construction of commercial shops and land development charges received by him from land owners but had failed to deposit his Service Tax liability on construction of Villas. Accordingly, a show cause notice dated 17.01.2017 invoking extended period was issued for demanding Service Tax along with interest & proposing imposition of penalties. The adjudicating authority, vide the Order-in-Original No. 18/JC/HPR/2017-18 dated 18.05.2017, confirmed the demand along with interest, and appropriated the amount of tax already deposited towards the confirmed demand. Penalty equal to confirmed demand and penalty for non-filing of ST-3 return were also imposed. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ere consequently totally different from the facts of the case of A.S. Sikarwar (supra). The Commissioner (Appeals), Dehradun had errred by not considering the case in its totality of the activities performed by the assessee. As regards the assessee's appeal, learned authorized representative submitted that they had accepted their service tax liability on the commercial shops and had paid the same, and not disputed the same before the Commissioner (Appeals). Learned authorized representative further stated that as the assessee had not paid the amount of penalty within 30 days of the issue of order-in-original, hence, the benefit of reduced penalty was not admissible to them. 4. No one appeared on behalf of the assessee. However, the assessee in the grounds of appeal has referred to letter dated 26.10.2016 claiming that single row houses in the form of Villas were not chargeable to tax as these were not residential complex as defined under Section 65(91a) of Finance Act, 1994. The construction had been undertaken based on the contracts for Villa construction with the plot owners, who were entitled for exemption vide S. No. 14(b) of notification 25/2012-ST dated 20.06.2012. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a building or buildings, having more than twelve residential units; (ii) a common area; and (iii) 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 authority under any law for the time being in force, but does not include a complex which is constructed by a person directly engaging any other person for designing or planning of the layout, and the construction of such complex is intended for personal use as residence by such person. Explanation. For the removal of doubts, it is hereby declared that for the purposes of this clause,-(a) "personal use" includes permitting the complex for use as residence by another person on rent or without consideration; From the definition it is abundantly clear from the above provisions that construction of residential complex having not more than 12 residential units is not sought to be taxed under the Finance Act, 1994. For the levy, it should be a residential complex comprising more than 12 residential units. Admittedly, in the present case, the appellants constructed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... units. In other words a complex may have a building having more than twelve residential units or a complex may have more than one building each having more than twelve residential units. Independent buildings having twelve or less than Twelve residential units would not be covered by the definition of "residential complex. 18. This submission, for the reasons stated above, deserves to be accepted. In this connection reliance can be placed on a Division Bench judgment of the Tribunal in Macro Marvel Projects Ltd. vs. Commissioner of Service Tax, Chennai (2008 (12) STR 603 (Tri-Chennai)] wherein the demand of service tax was for the period 16 June, 2005 to November, 2005 under 'construction of complex' service under section 65(30a) of the Act. The Bench examined the scope of 'construction of complex and the meaning of a 'residential complex' under section 65(91a) of the Finance Act and the observations are as follows: "It is abundantly clear from the above provisions that construction of residential complex having not more than 12 residential units is not sought to be taxed under the Finance Act, 1994. For the levy, it should be a residential complex compri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of development charges from the owner of the land under different projects. It was informed during the personal hearing that he had discharged his tax liability along with interest in respect of development of land for the land owners and construction of commercial shops before the issue of the show cause notice and the same has been appropriated by the adjudicating authority. He has only contended that the benefit of reduced penalty was admissible to him. In this regard, I find that the third proviso to the said Section 78 (1) of the Act makes it clear that the benefit of the reduced penalty is available only if the amount of such reduced penalty is also paid within such period. As the appellant has not paid the amount of penalty within thirty days of the issue of the impugned order, the benefit of reduced penalty is not admissible to him." As the assessee did not take these grounds before the Commissioner (Appeals), hence they are not at liberty to challenge the same before the Tribunal, more so when the leave of the Tribunal was not taken before riasing these grounds in the present appeal. 10. As regards the assessee's plea on reduced penalty, we note that the proviso to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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