The Ahmedabad bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) quashed the service tax demand on Construction of a Residential complex under the Jawaharlal Nehru Urban Renewal Mission on the ground of the absence of commercial activity.
H K Ramani, the appellant assessee was engaged in the construction of a residential complex in respect of the works contract for the construction of a residential complex under the Jawaharlal Nehru Urban Renewal Mission Scheme for Surat Municipal Corporation.
The assessee appealed against the order passed by the Commissioner (Appeals) for confirming the demand of service tax imposed for the construction service on the assessee.
Hardik V Vohra, the counsel for the assessee contended that the construction of the Complex is made for the JnNURM scheme and the construction of houses for SafaiKamdarfor the Ahmedabad Municipal Corporation, and the houses are made under a particular scheme for the poor people for residential purposes and not for other commercial activity.
A.K Samota, the counsel for the department relied on the decisions made by the lower authorities and contended that the demand raised by the revenue was as per the law and liable to be sustained.
The Bench observed that in the case of Cemex Engineers v. Commissioner of Service Tax Cochin, the court held that the service provided by the assessee was to be treated as a service provided to Govt. of India directly and end use of the residential complex by Govt. of India was covered by the definition of personal use in the explanation to definition of residential complex service, the other aspects need not be considered and this services was mot levy to service tax.
The two-member bench comprising Ramesh Nair (Judicial) and C.L Mahar (Technical) quashed the demand for service tax while allowing the appeal filed by the assessee.
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