CESTAT denies Service Tax Exemption for Mandi Constructions as Market Structures Fall Under 'Business or Commerce'

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has denied a service tax exemption for the construction of shops and other structures within an agricultural mandi (market). The tribunal ruled that these market structures fall under the category of "business or commerce" and are therefore not eligible for the exemption that applies to certain other types of construction. The assessee had argued that the constructions were for agricultural purposes. However, the CESTAT observed that the shops and platforms within the mandi were commercial in nature, as they were used for trading and business activities. The tribunal held that the exemption is intended for structures directly related to agricultural production, not for commercial buildings within a market complex. This decision clarifies the scope of the service tax exemption for construction services, limiting it to non-commercial agricultural structures.