DELTA CONSULTANTS Vs. CST

JUDGEMENT

(1.) LEARNED authorised Representative Shri Batra submits that the description of service "finishing" was brought to the statute book for taxation w.e.f. 16/06/05 making necessary amendment to the definition of Commercial or Industrial construction Service under Section 65(105)(zzq) of the Finance Act, 1994. The amendment resulted to bring industrial construction service into the fold of law for taxation. Accordingly, the service was renamed as commercial or industrial construction service. Such term was redefined by Section 65(105)(zzq) to bring the finishing service for taxation. He submits that law does not prescribe to tax the goods while that is used in providing service of above nature. The goods component involved in the service in relation to the redefined period was 70% of the gross value of the contract executed after 16/06/05. The period in dispute is 10/09/04 to 31/03/07. Therefore pre -deposit may not be insisted when goods were involved in the work without service being provided.

(2.) ACCORDING to the learned DR, the demand of Rs. 4,38,402/ - (Rupees Four Lakh Thirty Eight Thousand Four Hundred Two) relates to the period 10/09/04 to 15/06/05 when "finishing" activity was not subject matter of tax. Accordingly, the tax demand of Rs. 44,39,122/ - (Rupees Forty Four Lakh Thirty Nine Thousand One Hundred Twenty Two) shall get reduced to Rs. 40,00,720/ - (Rupees Forty Lakh Seven Hundred Twenty) towards service tax relating to the period 16/06/05 to 31/03/07 which is a period after "finishing" activity was brought to tax ambit. He submits that in page No. 30 -32 of the appeal folder, description of the material composition and various services provided is depicted. At this stage of stay hearing the appellant may be called upon to discharge tax liability atleast on 33% of the gross value of the consideration received during the period 16/6/05 to 31/3/07. This appeal is also subject to challenge on the dispute of valuation.

(3.) LEARNED DR replies that when finishing service came into statute book, that has been rightly considered by the learned Authority below and without taxing the material, service portion has been taxed. This is very clear when the learned Commissioner has made working under paragraph 40 of order -in -original at page 31. To this proposition of Revenue, Shri Batra, learned authorised representative objects that the entire receipt for the period from 10/09/04 to 31/03/07 has been taxed ignoring the taxable events by the amended definition w.e.f. 16/06/05.