COMMISSIONER Vs. LARSEN AND TOUBRO LTD

JUDGEMENT

(1.) Both these appeals under section 35G of the Central Excise Act, 1944 (hereinafter referred to as "the Act"), challenging the order dated 07.11.2012 passed by the Customs, Excise and Service Tax Appellate Tribunal, West Zonal Bench, Ahmedabad (hereinafter referred to as "the Tribunal") in Appeal No. ST/329/11 and Appeal No.ST/330/11, have been admitted vide separate orders dated 24th July, 2014 on the following substantial questions of law:

(2.) As is apparent on a plain reading of the questions, the first question relates to the maintainability of the appeals and as such, is required to be decided as a preliminary issue. For the purpose of deciding the preliminary issue, it would be necessary to notice some basic facts relating to the nature of the case before the Tribunal.

(3.) The respondent M/s Larsen & Toubro Limited is engaged in the execution of lumpsum turnkey contracts for setting up plants and other facilities and providing services of design and engineering, procurement, project management and project supervision, information technology and information technology enabled service. The respondent set up two units for providing engineering and design service, project management services and services of back office operations and both the units are located in the Special Economic Zone (SEZ). The SEZ units also carry out work in-house for the units located in Domestic Tariff Area (DTA) of L & T Ltd. To levy service tax on SEZ units, a proposal was made on the ground that the units located in SEZ and DTA units of L & T Ltd., are separate legal entities and the services provided by SEZ units to DTA units are taxable services and therefore, the service tax is leviable.