M/S. Sheth & Sura Engineering Pvt. Ltd vs Commissioner Of Central Excise, Nagpur

[Arising out of Order-in- Appeal No. SN/138/NGP/2008 dtd. 10/12/2008 passed by the Commissioner (Appeals) of Central Excise & Customs, Nagpur]

For approval and signature:

Honble Mr. P.S. Pruthi, Member(Technical) Honble Mr Ramesh Nair, Member(Judicial)

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1. Whether Press Reporters may be allowed to see : No 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 : seen of the Order?

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

M/s. Sheth & Sura Engineering Pvt. Ltd. : Appellants

VS

Commissioner of Central Excise, Nagpur : Respondent

Appearance

Shri. Anupam Dighe, Advocate for the Appellants Shri. B. Kumar Iyer, Superintendent (A.R.) for the Respondent

CORAM:

Honble Mr. P.S. Pruthi, Member (Technical) Honble Mr. Ramesh Nair, Member (Judicial)

Date of hearing: 19/5/2015 Date of decision 19/5/2015

ORDER NO.

Per : P.S. Pruthi

Appellants are in appeal against impugned order- in-appeal dated 10/12/2008 in which Commissioner(Appeals) upheld the rejection of refund claim filed by the appellant.

2. The facts are that the appellant entered into agreement with M/s. MAHAGENCO, Mumbai for designing, engineering, manufacturing, supply, assembly and testing of manufacturers works, inspection, packing into properly sized units, forwarding, delivery for site and unloading receipt and storage at site, site fabrication, complete servicing of cleaning, painting, erection testing and commissioning and finally handing over the large diameter piping and steel tank system included civil works. They paid service tax for the period Jan 2006 to May 2006 under the service tax category of erection and commission which was brought into the fold of Service tax on 1/7/2003. From 1/10/2003, the word installation was added and the service category become erection, commissioning or installation. Refund claim was filed on 8/6/2007 of Rs. 7,98,953/- on the ground that their contract is a Works Contract on turnkey basis and not erection, commissioning or installation contract. The refund claim was rejected on the ground that the activity undertaken is covered under the category of Erection, commissioning or installation.

3. Heard both sides and considered submissions.

4. We find that the issue involved in this case is whether prior to 1/6/2007, works contract can be vivisected into various component services such as erection and commissioning which were in force from the year 2003. We note that matter has finally been put to rest by the Larger Bench decision in the case of Larsen & Toubro Ltd. Vs. Commr. of S. Tax Delhi [2015(38) STR 268(Tri. LB) which also refers to Delhi High Court decision in the case of G.D. Builder Vs. Union of India[2013(32) STR 673(Del)]. The Larger Bench decision also distinguished the case of Commissioner Vs. Turbotech Precision Engineering Pvt. Ltd. The Larger Bench held that for the period prior to introduction of Works Contract service, a contract can be vivisected and if the service involved is covered under the Erection, commissioning and installation service, such contract would be leviable to service tax. In view of the stated position appeal is rejected.

(Dictated in court)

Ramesh Nair Member (Judicial) P.S. Pruthi Member (Technical) sk

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