Case Details: Commissioner of Central Excise Bengaluru Service Tax-I Versus Confident Projects Pvt. Ltd. (2025) 34 Centax 109 (S.C.)
Judiciary and Counsel Details
- J.B. Pardiwala & R. Mahadevan, JJ.
- S/Shri Arijit Prasad, Sr Adv., N. Venkataraman, A.S.G., Ms Arushi Singh, Yashraj Bundela, Ms Mili Baxi, Akshay Amritanshu, Advs., Gurmeet Singh Makker, AOR, for the Petitioner
Facts of the Case
The Appellant, a builder/developer, undertook construction of projects by entering into construction agreements with prospective buyers/owners of undivided portions of land for the construction of flats or villas, with payment structured in instalments. The Appellant submitted that such transactions constitute a ‘Works Contract’ service and contended that they were eligible for the composition scheme under the Works Contract (Composition Scheme for payment of Service Tax) Rules, 2007. The CESTAT had previously held that the activity falls within the ‘Works Contract’ service category and that the Appellant is entitled to the benefits of the composition scheme. The Appellant further relied on the provisions of Section 35L of the Central Excise Act, 1944, as made applicable to service tax under Section 83 of the Finance Act, 1994. The matter was accordingly placed before the Supreme Court.
Supreme Court Held
The Hon’ble Supreme Court held that the construction of projects undertaken by the Appellant under agreements with prospective buyers/owners of undivided portions of land, for the construction of flats or villas on payment in instalments, constitutes a ‘Works Contract’ service. The Court affirmed that the Appellant is eligible for the composition scheme as per the Works Contract (Composition Scheme for payment of Service Tax) Rules, 2007. The appeal against the CESTAT order was dismissed on the grounds of delay as well as merit, with the Court finding no reason to interfere with the CESTAT’s determination.
