M/s. Alstom T and D India Ltd. Versus Commissioner of GST and Central Excise Chennai
Service Tax
2018 (9) TMI 1669 – CESTAT CHENNAI – TMI
CESTAT CHENNAI – AT
Dated:- 29-8-2018
Appeal Nos. ST/26 and 44/2012 – Final Order Nos. 42320-42321/2018
Service Tax
Ms. Sulekha Beevi C.S., Member (Judicial) And Shri Madhu Mohan Damodhar, Member (Technical)
Shri Joseph Prabhakar, Advocate for the Appellant
Shri A. Cletus, Addl. Commissioner (AR) for the Respondent
ORDER
Per Bench
The issue involved in both these appeals being the same, they are heard together and are disposed by this common order.
2. Brief facts are that the appellant is engaged in manufacture of transformers and other electrical switchgear which are supplied to various Electricity Boards. On scrutiny of ST-3 returns, it was observed that the appellant was paying service tax at the rate of 4% for the services rendered by them under works contract service. In the returns filed by them for earlier periods
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st and also imposed penalties. Hence these appeals.
3. On behalf of the appellant, ld. counsel Shri Joseph Prabhakar submitted that the issue with regard to the bifurcation of the contract into supply contracts, erection, commission and installation and civil structure works and the liability to service tax as well as to their abatement under Notification 1/2006 was considered by the Tribunal in the appellant's own case as reported in 2018-VIL-385-CESTAT-CHE-ST. With regard to the second issue as to the requirement of exercising option for payment of service tax under the composition scheme, he submitted that it was only a procedural lapse and that the Tribunal in the case of Vaishno Associates Vs. Commissioner of Central Excise, Jaipur – 2018-TIOL-1486-CESTAT-DEL has considered the issue and held the same in favour of the assessee.
4. The ld. AR Shri A. Cletus supported the findings in the impugned order.
5. Heard both sides.
6. The first issue is with regard to the allegation tha
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s taken together form a turnkey project and has proceeded to deny abatement on the civil works portion by observing that the tax payer cannot pay full rate on one portion and avail abatement on the other portion. But, it is seen that the Revenue has made no attempt to combine the three contracts into one mega turnkey project. No attempt has been made to assess such a composite contract as a single works contract. Hence we are of the view that the supply contract, erection contract as well as civil works contract are required to be assessed independently since the same have been executed separately by the two parties.
7.2 Considering the civil works contract, the adjudicating authority has blindly gone by the classification declared in the ST3 returns under 65 (105) (zzd). The execution of civil works no doubt involves supply of materials in the form of steel, cement 7 etc. Consequently, such contracts merit classification under 65 (105) (zzq) under commercial or industrial constructi
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