(1.) DURING the period 2007 -08 to 2010 -11, appellant had provided services to various customers but had not paid the Service Tax. Taking a view that the services provided by the appellants are classifiable under commercial or industrial construction service, works contract service, proceedings initiated culminated in confirmation of demand for Service Tax of Rs. 32,50,113/ - which was upheld on an appeal filed by the appellants in the impugned order of the learned Commissioner (Appeals) No. 12/2012 (H -I) S.T., dated 30 -11 -2012. Heard both the sides.
(2.) The learned Counsel on behalf of the appellants submitted that they had constructed cycle stand, canteen building, stores shed, etc., for M/s. Singareni Collieries Company Ltd. (SCCL). He submitted that these buildings cannot be considered as constructed for industrial or commercial purposes at all and therefore, Service Tax cannot be levied. He submits that on the works contract service, if the buildings are not for commercial or industrial purposes, no tax can be levied. He also submits that they had undertaken the removal of old doors and windows and fixing of the new ones in the quarters/residential accommodation belonging to SCCL and this was a job work given to them by another contractor. He submits that this cannot be considered as repair of old buildings and even if considered they had only refixed the doors and further he also submits that according to the definition of works contract service, only when repairs are undertaken in respect of new buildings, the Service Tax is attracted under the category of works contract service. He submits that the work undertaken for A.P. Genco was also the same type of work and therefore it may not be liable to tax at all. The construction of cycle stand, canteen building, project office building, stores shed, basement for sub -station, site office, etc., for SCCL in our opinion, have to be considered as constructed for industrial purposes. According to the definition of works contract service, such construction activities undertaken for industrial purposes are liable to Service Tax and therefore, we do not consider that appellant has made out a prima facie case in respect of these services for which the demand approximately comes to Rs. 25 lakhs.
(3.) AS regards the replacement of doors, we find that works contract service definition reads as under: -
(i) transfer of property in goods involved in the execution of such contract is leviable to tax as sale of goods, and
(ii) such contract is for the purposes of carrying out, -
(a) erection, commissioning or installation of plant, machinery, equipment or structures, whether pre -fabricated or otherwise, installation of electrical and electronic devices, plumbing, drain laying or other installations for transport of fluids, heating, ventilation or air -conditioning including related pipe work, duct work and sheet metal work, thermal insulation, sound insulation, fire proofing or water proofing, lift and escalator, fire escape staircases or elevators; or
(b) construction of a new building or a civil structure or a part thereof, or of a pipeline or conduit, primarily for the purposes of commerce or industry; or
(c) construction of a new residential complex or a part thereof; or
(d) completion and finishing services, repair, alteration, renovation or restoration of, or similar services, in relation to (b) and (c); or
(e) turnkey projects including engineering, procurement and construction or commissioning (EPC) projects;
It can be seen that clause (d) of the definition provides that the repair undertaken in respect of buildings in clause (b) and (c) would be leviable to Service Tax and clause (c) speaks of only new buildings. Moreover, it was also submitted that they replaced only doors and the door cost has also been included. It is an arguable issue and the show cause notice was issued on 20 -4 -2011 and therefore, substantial portion of the demand would be beyond the normal period of limitation and therefore, at this stage, we consider that we need not insist for pre -deposit in respect of this service.
The above discussion would show that appellant has not made out a prima facie case in respect of Service Tax demand of about Rs. 25 lakhs. Taking note of the fact that the appellant has deposited an amount of Rs. 10 lakhs as per the directions of the learned Commissioner (Appeals) for hearing the appeal, we consider that appellant should be directed to deposit another Rs. 10 lakhs (Rupees ten lakhs only) within six weeks and report compliance on 16 -3 -2015. The learned Counsel is present and takes note of the directions. It is made clear that if the amount is not deposited within the date specified and compliance reported, the appeal is liable to be rejected.
(Pronounced in the Court);