In the case of Commissioner, ST, New Delhi v. M/s Swadeshi Construction Company, the Delhi CESTAT held that Service Tax cannot be levied for the construction of Delhi Haats under the head “Commercial or Industrial Construction”.
In the instant case, the Revenue approached the Tribunal against the order of Commissioner of Service Tax, New Delhi wherein the authority dropped the entire demand of Service Tax of Rs.93,01,154/- with reference to construction project of Delhi Haat in INA and Pitampura.
The authority also held that the said construction cannot be classified as “Commercial or Industrial Construction” and dropping the demand.
Before the Tribunal, the Revenue contended that the said construction is one of the profitable commercial ventures by the DTTDC and the tax liability should have been confirmed on such construction activity and relied on the apex court decision in M/s Larsen & Toubro Limited-2015 TIOL (187) SC ST wherein held that in case the contracts were found to be not of composite nature, the respondent shall be liable to service tax as this construction is for commercial purpose.
Based on the above said judgment, the Tribunal ordered that constructions undertaken by the appellant are in pursuance of composite works contracts and was not liable to be taxed.
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