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M/s. BEST Infra-Projects Ltd. v/s CCE, Cochin

    Appeal No.ST/731/09; Appn.No.ST/St/446/09 (Arising out of Order-in-original No.16/2009/ST dt. 11/5/2009 passed by CCE,C&ST, Cochin)

    Decided On, 12 April 2010

    At, Customs Excise Service Tax Appellate Tribunal South Zonal Bench At Bangalore


    For the Appellant : G. Subramaniam, Advocate. For the Respondent : U. Raja Ram, JDR for the Revenue.

Judgment Text

Per M.V. Ravindran

This stay petition is directed for the waiver of the pre-deposit of the following amounts:-

a. Tax - Rs. 83,42,085/-

b. Education Cess - Rs.1,66,843/-

c. S/H Ed. Cess - Rs.17,045/-

d. Tax - Rs.13,35,194/-

e. Education Cess - Rs.26,704/-

f. Interest on a to e.

g. Penalty - Rs.1000/- u/s 77.

h. Penalty - Rs.98,87.871/- u/s 78.

2. The issue involved in this case is regarding the service tax liability on the various projects undertaken by them. The adjudicating authority has come to the conclusion that the fabrication, erection, installation and commissioning works undertaken by the appellant will fall under the category of ?erection, installation and commissioning service? w.e.f. 10/7/2004 and having not discharged the service tax liability, they are liable to pay the service tax.

3. After hearing both sides for some time on the matter, we find that the appeal itself could be disposed off as it lies in a very narrow compass. I view of this, we grant waiver of the pre-deposit of the amounts involved, allow the stay petition and take up the appeal itself for disposal.

4. Ld. Counsel submits that the adjudicating authority had not considered in proper perspective the fact that the service tax liability was discharged by the main contractor. It is the submission that the appellants herein were sub-contractors for L&T Ltd. and IVRCL etc. It is the submission that they had taken a plea that the main contractor has discharged the service tax liability on the entire service rendered and as sub-contractor, they are not liable to pay service tax.

5. Ld. DR reiterates the findings of the lower authority.

6. On perusal of the record, we find that the adjudicating authority has not addressed the plea of the appellant that they are sub-contractors and the main contractors have discharged the service tax liability. The findings of the ld. adjudicating authority in para 31 reads as under:-

?31. The assessee has not produced any evidences to show that the service tax liability for the services rendered by them has been discharged by M/s. IVRCL. During the personal hearing the assessee submitted that the main contractor has issued a letter of undertaking to clear the entire service tax liability. It means that the service tax liability in relation to the services provided by the assessee is yet to be discharged. In this circumstances, I am of the view that the assessee is liable to pay service tax for the services rendered by them in respect of SPM-KRL-IVRCL pipe line project. As such the rulings cited by the assessee are not relevant to their case.?

7. The above findings would not take away the right of the assessee/appellant the very exemption, if due, from service tax if the service tax liability is discharged by the main contractors. Since the issue involved in this case requires appreciation of the evidence on the factual matrix, we, without expressing any opinion on the merits of the case, hold that the impugned order is a non-speaking order on the point/plea raised by the appellant, resulting it to be set aside and we

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do so, and remand the matter to back to the adjudicating authority to re-consider the issue afresh after granting an opportunity of personal hearing to the appellant. 8. Stay petition and appeal are disposed off by way of remand to the adjudicating authority. (Operative portion of this order pronounced on conclusion of the hearing)