CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL CHENNAI REGIONAL BENCH – COURT NO. I Service Tax Appeal No. 41409 of 2016 (Arising out of Order-in-Appeal No. 236/2016 (STA-I) dated 26.04.2016 passed by the Commissioner of Service Tax (Appeals-I), Newry Towers, 3^rd Floor, Plot No.2054, I Block, II Avenue, Anna Nagar, Chennai 600 040)

M/s. Jai Energy Engineers ...Appellant Flat “A”, Ground Floor, Sam’s Nathaneal Towers, No.3, West club Road, Shenoy Nagar, Chennai - 600 030.

Versus The Commissioner of GST & Central Excise, ...Respondent Chennai South Commissionerate, MHU Complex, No.692, Anna Salai, Nandanam, Chennai - 600 035.

APPEARANCE:

For the Appellant : Mr. M. S.Krishnakumar., Advocate For the Respondent : Ms. Rajini Menon, Authorised Representative CORAM:

HON’BLE MR. AJAYAN T.V, MEMBER (JUDICIAL)

FINAL ORDER No.40278/2026 DATE OF HEARING: 04.02.2026 DATE OF DECISION: 20.02.2026 Per AJAYAN T.V.

Jai Energy Engineers, the appellant herein is challenging the order in Appeal No.236/2016 (STA-I), dated 26.04.2016 (the impugned order), whereby the Appellate Authority has upheld the Order in Original No.124/2011, dated 30.10.2011 passed by the Adjudicating Authority, confirming the demand of service tax along with applicable interest and imposition of penalties.

2. Brief facts of the case are that the appellant, a sole proprietary concern, is registered with the department as a provider of Erection, Commissioning and Installation services. During the audit of the appellant stated to have been conducted in January 2010, it was noticed that the appellant had not paid service tax of Rs.21,22,551/- on erection and commissioning services for the period October 2008 to November 2009; non-payment of service tax of Rs.3,30,032/- on commission received during the period from 2004-05 to 2006 -07 (Business Auxiliary Services) and short payment of service tax of Rs.3,08,635/- on erection and commission services for the period April 2006 to March 2008. On being pointed out, the appellant paid the entire service tax liability with appropriate interest immediately during the audit of the appellant.

3. However, a Show Cause Notice No.320/2010 dated 23.04.2010, invoking the extended period under proviso to Section 73 (1) of the Finance Act came to be issued demanding a total service tax of Rs.27,61,218/- and interest of Rs.4,87,047/- and proposing to adjust the service tax and interest that already stood paid before the issuance of Show Cause Notice. Consequent to the reply filed by the appellant, after due process of law, the Adjudicating Authority dropped the demand of service tax on BAS for the period to prior to 09.07.2004 to the tune of Rs.1,68,731/- along with interest of Rs.1,22,656/- on the finding that the Notification No.13/2003-ST dated 20.06.2003 which exempted the BAS provided by a commission agent from the service tax leviable thereon was amended only on 09.07.2004 confining such exemption to the services provided by a commission agent in relation to sale or purchase of agricultural produce and therefore the services of a commission agent are exempted for the period prior to 09.07.2004 and even otherwise since the SCN was served on 23.04.2010, although the demand of service tax on the commission amount starts from 14.04.2004, ,the demand for the amounts received prior to 01-10- 2004 is time barred. However, the balance demand of service tax along with interest was confirmed and equivalent penalty of Rs.25,92,487/- under Section 78 of the Act and a penalty of Rs.5,000/- under Section 77 of the Act along with the interest demanded, was confirmed. Aggrieved by the order, dated 31.10.2011 of the Adjudicating Authority, the appellant filed an appeal before the Commissioner of Service Tax, Appeals, who has however, vide the impugned order dismissed the appeal. Hence the present appeal.

4. Shri M.S. Krishnakumar, Ld. Advocate appearing on behalf of the appellant contented that the Show Cause Notice itself records the fact that the appellant has p