No Service Tax on installation of thermal insulation being 'Work Contract Service'

Last updated: 25 January 2023
Quick Summary
The CESTAT has ruled that the installation of thermal insulation does not attract Service Tax, as it falls under the definition of 'Works Contract Service'. The tribunal set aside an order demanding Service Tax and penalties against Rudra Engineering, finding that the company was eligible for abatement benefits. The ruling clarifies that the scope of 'Works Contract Service' includes materials used in insulation, not just plant and machinery.

Court :
CESTAT, Ahmedabad

Brief :
The CESTAT, Ahmedabad in Rudra Engineering v. C.C.E. & S.T.-Vadodara-I [Service Tax Appeal No.10535 of 2013 dated January 16, 2023] has set aside the order demanding Service Tax for alleged wrongly availing abatement and wrong classification of service under Works Contract Service. Held that, the installation of 'thermal insulation' is a covered under the definition of "Works Contract Service" and therefore, the Service Tax is not demandable.

Citation :
Service Tax Appeal No.10535 of 2013 dated January 16, 2023

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