ST - Retrospective exemption granted by sections 97, 98 of FA, 2012 - as this is later development, much after passing o-in-o, matter remanded to AA: CESTAT
By TIOL News Service
MUMBAI, JULY 22, 2017: THE appellants are engaged in civil construction work for Government departments like PWD, Irrigation, Nagar Palika, KrishiUtpadan Bazar Samiti, etc. and they have not discharged service tax during 2005-06 to 2009-10.
SCNwas issued which culminated into an order confirming a service tax demand of Rs.1,01,00,316/- with penalty and interest.
Therefore, the appellant is before the CESTAT.
It is inter alia submitted that as per the amendment by Section 97 and 98 of Finance Act, 2012 these services are exempted retrospectively from payment of service tax and hence the demand is not sustainable; that as per the decision in the case of Khurana Engineering Ltd. - 2010-TIOL-1712-CESTAT-AHM, service provided to CPWD is not considered as taxable service; that service provided is in the nature of 'Works contract service' which became taxable only from 01/06/2007.
The AR submitted that the submissions now being made were not raised before the adjudicating authority for the reason that the retrospective amendment has come into effect only after passing of the impugned order and, therefore, the matter needs to be remanded.
The Bench observed -
"4. … We find that the appellant raised an issue of retrospective amendment made under Section 97 and 98 of Finance Act, 2012. Since this retrospective amendment was brought subsequent to the passing of the impugned order, the adjudicating authority had no occasion to deal with such amendment. The issue is also appears to be covered prima facie by decision of the Khurana Engineering Ltd (supra). The issue of service being 'works contract' raised by the appellant was also not considered by the adjudicating authority…"
The appeal was allowed by way of remand to the adjudicating authority.
(See 2017-TIOL-2543-CESTAT-MUM)
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