M/S. M.B. Chitale Constructions vs Commissioner Of Central Excise, Pune

(Arising out Order-in-Appeal No. PIII/VM/252/2009 dated 26.11.2009 passed by the Commissioner of Central Excise (Appeals), Pune III)

For approval and signature: Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr P.R. Chandrasekharan, Member (Technical)

1. Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?

2. Whether it should be released under Rule 27 of the CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?

3. Whether Their Lordships wish to see the fair copy Yes of the Order?

4. Whether Order is to be circulated to the Departmental Yes authorities?

M/s. M.B. Chitale Constructions Appellant

Vs.

Commissioner of Central Excise, Pune Respondent

Appearance:

None for the appellant Shri R.K. Das, AC (AR) for the respondent

CORAM:

Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. P.R. Chandrasekharan, Member (Technical)

Date of hearing : 30/01/2015 Date of decision : 30/01/2015

O R D E R No:..

Per: P.R. Chandrasekharan:

The appeal is directed against Order-in-Appeal No. PIII/VM/252/2009 dated 26.11.2009 passed by the Commissioner of Central Excise (Appeals), Pune III. Vide the impugned order, the ld. lower appellate authority has rejected the appeal filed by the appellant M/s. M.B. Chitale Constructions, against the order dated 21.03.2009 passed by the Jurisdictional Additional Commissioner. In the order dated 21.03.2009, a service tax demand of `21,73,351/- has been confirmed against the appellant by denying the benefit of Notification no. 15/04-ST dated 10.09.2004 and 1/2006-ST dated 01.03.2006 on the ground that the appellant did not include the value of the goods received free of cost from the service recipient while claiming the benefit of abatement under the aforesaid Notifications and consequently the appellant is not eligible for the benefits therein. Further, a penalty of equivalent amount has been imposed against it under Section 78 of the Finance Act, 1994. Aggrieved of the same, the appellant is before us.

2. None represented the appellant despite notice.

3. The ld. Asst. Commissioner (AR) appearing for the Revenue seeks to support the impugned order and reiterates the findings given therein.

4. We have considered the submissions of the ld. AR and the grounds urged in the appeal memo.

4.1. We find that the issue involved herein has already been decided by a Larger Bench of the Tribunal in the case of Bhayana Builders P. Ltd. & Ors. 2013-TIOL-1331-CESTAT-DEL-LB. In the said decision, the Larger Bench held that the value of the goods and materials supplied free of cost by a service recipient to the provider of the taxable construction service, being neither monetary or non-monetary consideration paid by or flowing from the service recipient, accruing to the benefit of service provider, would be outside the taxable value or the gross amount charged, within the meaning of later expression in Section 67 of the Finance Act, 1994; and the value of free supplies by service recipient do not comprise the gross amount charged under Notification no. 15/04-ST, including the explanation thereto as introduced by Notification no. 4/05-ST. Accordingly, the Larger Bench held that the benefit of Notification no. 15/04-ST and Notification 1/06-ST would be available even if value of the goods and materials supplied by the service recipient are not included for the purpose of computation of the abatement provided under these Notifications. The issue involved in the present case is also identical and therefore, the appellant would be eligible for the benefit of the aforesaid Notifications. Accordingly, we allow the appeal with consequential relief, if any in accordance with law.

(Operative part pronounced in Court)

(M.V. Ravindran) (P.R. Chandrasekharan) Member (Judicial) Member (Technical)

//SR

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