9911796707
TMI Blog2007 (1) TMI 56X X X X Extracts X X X X X X X X Extracts X X X X ..... vice Tax due for the period from 1-7-2003 to 31-3-2004 and Rs. 10,67,45,416/- for the period from 1-4-2004 to 31-3-2005 have been confirmed. Education Cess of Rs. 11,86,060/- has been confirmed for the latter period. Interest under Section 75 has been demanded. Penalties under Section 75A, 76 and 77 have been imposed. Further, penalty of Rs. 18,07,99,483/- has been imposed under Section 78 of the Finance Act, 1994. The main allegation against the appellant is that during the above mentioned period, the appellants rendered the services under the category of 'Maintenance and Repairs Services' and failed to observe the statutory formalities and pay the appropriate service tax. Based on clarification issued by the Director General of Service Ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -2005 are not liable to be taxed is justifiable". The appellants are therefore not liable to any penalty or interest for non-payment of the alleged dues of Service Tax for the period prior to 16-6-2005. (iv) The Commissioner has relied on a clarification from the Director General of Service Tax, however, the clarification was never put to the appellants. That apart, it is settled law that clarification issued by the Director General of Service Tax are not binding upon quasi judicial authorities. (v) The repair activities carried out by the appellants on the ships/vessels are in the nature of works contracts or lump sum contracts and there is no scope for vivisecting the same as to separate the same into service portions and supply porti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... circular referred to supra by the learned advocate is clearly applicable. In other words, in the absence of a maintenance contract prior to 16-6-2005, the appellants are not liable to pay Service Tax. The Director General of Service Tax has given some clarification, the Adjudicating Authority has relied on the same without putting the appellant to notice. This is bad in law. Moreover, the clarification of the Director General is contrary to the instructions of the Government. The entire period of dispute is prior to 16-6-2005. After the amendment on 16-6-2005, the appellant is paying Service Tax. It has been clarified by the Government that even if maintenance is carried out under any contract apart from other services, the appellant is not ..... X X X X Extracts X X X X X X X X Extracts X X X X
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