The Customs, Excise & Service Tax Appellate Tribunal (CESTAT) of Ahmedabad Bench has held that construction provided to Gujarat State Police Housing Corporation Limited is excluded from Service Tax.
R D Contractor & Company, the assessee that provided the construction provided to Gujarat State Police Housing Corporation Limited is excluded from Service Tax.
The lower authorities have contended that Gujarat State Police Housing Corporation Limited is not a Government of Gujarat organization whereas the same is an independent Company registered under the Company’s Act therefore, the service provided to Gujarat State Police Housing Corporation is liable to service tax.
Section 65(91a) of the Finance Act, 1994 defines “residential unit” to mean “a house or single apartment intended for use as a place of residence”. The said definition excludes personal use.
It was evident that the Gujarat State Police Housing Corporation Limited is 100% owned by the Government of Gujarat under the Ministry of Home Affairs therefore the same was held to be a government organization in various judgments.
From the precedents, the Tribunal observed that if the land owner enters into a contract with a promoter/builder/developer whom himself provided service of design, planning and construction and if the property is used for personal use then the such activity would not be subject to service tax. If the builder/developer constructs the complex himself, there would be no liability for service tax at all.
A Coram comprising of Mr Ramesh Nair, Member (Judicial) and Mr Raju, Member (Technical) observed that construction undertaken for personal use and such personal use including permitting the complex for use as a residence by another person are excluded from the service tax.
The Tribunal excluded the service of construction of the Gujarat State Police Housing Corporation. The Tribunal allowed the appeal and dismissed the revenue. Shri Mrugesh Pandya appeared for the Appellant-Assessee and Shri Kalpesh P Shah appeared for the Respondent
Subscribe Taxscan Premium to view the JudgmentSupport our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
