𝗖𝗘𝗦𝗧𝗔𝗧 𝗔𝗵𝗺𝗲𝗱𝗮𝗯𝗮𝗱 𝗥𝘂𝗹𝗶𝗻𝗴 𝗼𝗻 𝗦𝗲𝗿𝘃𝗶𝗰𝗲 𝗧𝗮𝘅 𝗟𝗶𝗮𝗯𝗶𝗹𝗶𝘁𝘆 𝗼𝗳 𝗦𝘂𝗯-𝗖𝗼𝗻𝘁𝗿𝗮𝗰𝘁𝗼𝗿𝘀 📢 𝗧𝗵𝗲 𝗧𝗿𝗶𝗯𝘂𝗻𝗮𝗹 𝗵𝗲𝗹𝗱: "When the principal contractor has discharged service tax liability on the entire value of construction services, the sub-contractor cannot be held separately liable for service tax."

🔍 𝗙𝗮𝗰𝘁𝘀: 𝗣𝗮𝗿𝘁𝗶𝗲𝘀: Shanti Construction Co. vs. C.C.E. & S.T.-Rajkot 𝗜𝘀𝘀𝘂𝗲: Whether the sub-contractor is liable for service tax when the principal contractor has already discharged the tax liability? 𝗔𝗰𝘁𝗶𝘃𝗶𝘁𝘆: The appellant acted as a sub-contractor, supplying goods and services for construction work. The department alleged liability for service tax under "Commercial or Industrial Construction Services."

⚖️ 𝗝𝘂𝗱𝗴𝗲𝗺𝗲𝗻𝘁: The Tribunal ruled that composite contracts are taxable only under "Works Contract Services" w.e.f. 1-6-2007, making the demand under "Commercial or Industrial Construction Services" unsustainable. Sub-contractors are not liable if the principal contractor pays full tax. Bona fide belief negated the extended limitation. The appeal was allowed.

𝗖𝗮𝘀𝗲 𝗜𝗻𝗳𝗼𝗿𝗺𝗮𝘁𝗶𝗼𝗻: 𝗧𝗶𝘁𝗹𝗲: Shanti Construction Co. vs. C.C.E. & S.T.-Rajkot 𝗢𝗿𝗱𝗲𝗿 𝗗𝗮𝘁𝗲: 27 February 2023 📜 This ruling emphasizes that sub-contractors are not liable for service tax when the principal contractor has already discharged the liability for the entire service.