The appellant carried out the work of providing and erecting ‘Fire Hydrant System’ for Krishi Upaj Mandi, Kukshi, District – Dhar (M.P.). The consideration was received for the said activity, on which the Department took the view that the appellant is liable to pay Service Tax under the category of ‘Erection, Commissioning or Installation Services’ (ECIS). The concurrent finding of both the authorities below was that the activity will be liable for payment of Service Tax and the benefit of abatement @ 67% towards the supply of material, available under Notification No. 1/2006-ST dated 01.03.2006 was extended. Against such findings, the present appeal has been filed.
Ld. Advocate submitted that the activity involved supply of material such as ‘Fire Hydrant System’ and erection and installing the same. He submitted that the activity is more appropriately classified under ‘Works Contract Service’. After the introduction of ‘Works Contract Service’ demand has been made under the ‘erection and commissioning services merits to be set aside.
AR justified the impugned order. He submitted that the plea that the activities were covered under ‘Works Contract Service’ has never before either of the authorities below and hence he justified the order for payment of Service tax under ECIS. After hearing both sides and on perusal of record, we find that the activity involves supply of ‘Fire Hydrant System’ as well as ‘Erection, installation’ of the same for Krishi Upaj Mandi. This nature of activity is squarely covered under the category of ‘erection and commission service’. Consequently, we uphold the demand of Service Tax with the grant of abatement.
Citation: [2018] 96 taxmann.com 555 (New Delhi – CESTAT)