CEMEX ENGINEERS Vs. THE COMMISSIONER OF SERVICE TAX

JUDGEMENT

(1.) THIS appeal has been filed against Order -in -Original No. 47/2007 dated 6.2.2008 passed by the Commissioner of Central Excise, Customs and Service Tax, Cochin.

(2.) THE appellants are engaged in (a) Commercial or Industrial Construction Service and (b) Construction of Complex Service (Residential). They were registered with the Service Tax department. They paid Service Tax after availing abatement of 67% of their gross receipts in terms of ST dt. 10.9.2004 in case of Commercial Construction Services and ST dt. 7.6.2005 and Notification No. 1/2006 ST dt. 1.3.2006 in case of construction of residential complexes for the period from 1.10.2005 to 31.3.2006. Show cause notice dt. 17.4.2007 was issued to the appellant on the ground that the cost of materials supplied was excluded for purpose of payment of Service Tax and the relevant Notifications viz., No. 15/2004 ST dated 10.9.2004 and No. 18/2005 -ST dt. 7.6.2005 do not provide such exclusions. The Original Authority passed the impugned order confirming the proposals in the show cause notice. Penalties were imposed under Section 76 and 77 of the Finance Act, 1994. Interest under demanded under Section 75 of the Finance Act, 1994. The appellants are highly aggrieved over the impugned order. The following grounds were urged.

(3.) WE have gone through the records of the case carefully. It is seen that the appellants had registered under the category of 'construction of residential complex' and 'commercial or industrial construction service'. The point at issue in the show cause notice is with regard to the availment of Notification No. 15/2004 and 18/2005, in terms of which an abatement of 67% on taxable value was claimed and further, the inclusion of the value of the materials supplied by the service recipient. The revenue has interpreted the explanation to the Notification to mean that the value of the materials supplied should be included. The said explanation is reproduced below.