COMMISSIONER OF CENTRAL EXCISE Vs. RAJEEV ELECTRICAL WORKS

JUDGEMENT

(1.) The symposium of the facts, culminating in the commencement of, relevant for disposal of present appeal filed by the revenue and emanating from the record, is that the respondent-assessee M/s. Rajeev Electrical Works (for short "the assessee") (electrical contractor) was engaged in electrical fittings and registered on 30-11-2004 for providing erection, commissioning and installation services. The revenue claimed that during the course of audit, it revealed that although the service of commissioning and installation was brought under the service tax net with effect from 1-7-2003 by the Finance Act, 1994 (for brevity "the Act"), but the assessee started paying service tax with effect from December, 2004. Therefore, a show-cause notice dated 1-11-2006 (Annexure A1) was issued to the assessee, as to why the service tax be not recovered along with interest by invoking the extended period and penal action be not taken for violation of the provisions of the Act and Rules.

(2.) In pursuance of the notice (Annexure Al), the assessee filed the reply and explained that as no incidental service in relation to the installation of plant, commissioning, machinery and equipment was taxable in respect of the period with effect from 1-7-2003, therefore, it (assessee) was not liable to pay any tax. According to the assessee, it has generally laid the pipe in wall/roof/floor for crossing of wires, fix the junction box etc. and at no point of time, it was entrusted with the job relating to the installation of plant, commissioning, machinery and equipment, which would attract the provisions of the Act. In all, according to the assessee, it was not liable to pay any service tax, during the relevant period. It will not be out of place to mention here that the assessee has stoutly denied all other allegations contained in the notice (Annexure A1) and prayed for its reversal.

(3.) The explanation put forth by the assessee did not find favour and the Assessing Authority confirmed the demand of service tax amounting to Rs. 1,62,705, pertaining to the period from 10-9-2004 to 30-11-2004 with interest. However, the proposal of penal action was dropped, vide order dated 7-12-2006 (Annexure A2).