Consulting Engineers Service — Works Contract Service

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This case involved a works contract on turnkey basis, wherein air separation/gas
separation plants were supplied and erection, installation and commissioning of
such plants was undertaken as per impugned contracts — Records indicating major
portion of activity relating to erection of various items of plants — CBE&C
Circular clarifying that erection, installation and commissioning not covered
under Consulting Engineer service — Erection and commissioning services made
taxable from 2003 and not chargeable to Service Tax under Consulting Engineer
during impugned period — Original order dropping demand after relying on
Tribunal decision in Daelim Industrial Co. Ltd. (2006) 3 STR 124 (Tri — Del.)
upheld — Impugned revision order set aside — S. 65(31), S. 65(39a), S.
65(105)(g) and S. 84 of the Finance Act, 1994 (Act).

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It was held that impugned contracts being works contract, came into Service Tax
net from 2007 only — Works contract not covered under Consulting Engineer
service for period prior to 2007 — Main contract for manufacture of plant and
their supply and erection — Drawing and design for manufacture of plant only and
not rendered directly to clients — Ratio of Tribunal decision in Daelim
Industrial Co. Ltd. Rightly followed in original order — Impugned revision order
set aside — S. 65(31), S. 65(105)(zzzza), S. 73 and S. 84 of the Act.