9911796707
TMI Blog2019 (5) TMI 1101X X X X Extracts X X X X X X X X Extracts X X X X ..... 99 to 30.04.2006 and total consideration was for Rs. 75,00,000. The appellants had received Rs. 55,00,000/- on 07.10.1999 and 24.01.2006. Hence, no service tax was leviable for the period upto 30.04.2006 under the aforesaid agreement. Agreement dt. 05.03.05 was for the period 01.03.05 to 28.02.15 and total consideration was Rs. 1 crore 20 lakhs. Under this agreement, no service tax was leviable for the period 05.03.05 to 30.04.06. The appellant had received Rs. 60 lakhs on 04.02.05, i.e before the date on which service tax was levied on service tax. 3. The Revenue felt that since the appellants realised a part of the amount of service in advance before the date on which service tax was levied on the said service, the appellant were leviable to pay service tax on that value of service tax, which was attributable to the service rendered in the period after service tax was levied on the said service. 4. Accordingly, a show cause notice dt.05.03.2008 was issued to the appellant demanding service tax of Rs. 8,33,340/- along with interest and proposing penalties under Section 76, 77 and 78 of the Finance Act, 1994. 5. The matter was adjudicated and the demand was confirmed along wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 80 of the Finance Act. 9. Ld. AR also relied upon the Board Circular dt. 05.11.03 and submitted that the amount of service tax was to be worked out on pro rata basis but has to be paid on lump sum basis as analysed in the order of the Ld. Commissioner (Appeals). He also stated that as per the amended definition of taxable service under Rule 65(105) of the Finance Act, 1994, the service tax is payable on receipt of advance payment irrespective of when the services are provided. He relied on the following case laws:- (1) P.T Education & Training Service Vs. CCE Jaipur, 2009 (14) STR34 (Tri. Delhi) (2) CCE Allahabad vs. Krishna Coaching institute, 2009 (14) STR (Tri. Delhi). 10. Heard the parties and perused the records. 11. We find that undisputed facts are that the appellant had signed two agreements before Service Tax levy on "sale space or time for advertisement" came into effect on 01.05.06. The appellants had received the advance payments in respect of both the agreements for the rendition of part of the service after 01.05.06. The appellants are not contesting the demand of duty but are only contesting the interest and penalty part. 12. We find that both the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... view of thereof, while the Board Circular dt. 05.11.2003 provided the basis to work out the value on pro-rate basis for the period prior to 01.05.2006 and after 01.05.2006, the payment of the Service Tax on the advance already received for value of taxable service to be rendered after 01.05.2006 was to be made for the month of May, 2006. Thus, the amount already received and worked out on pro-rata basis for the period 01.05.2006 and onwards has to be treated as value of taxable service received in the month of May, 2006. Hence, the Service Tax on the same was payable by 05.06.2006. In this regard, the following observations of the Ld. Commissioner (Appeals) are also quite relevant:- "This situation was also addressed w.e.f. 16.06.2005 when the definition of taxable service under Section 65(105) of the Finance Act, 1994 as amended by Finance Act 2005 to read "taxable service" means any service provided or to be provided. The words "to be provided" were inserted to provide for taxable services for which advance payments had been received in lieu of services yet to be provided. According to the amended provision service tax shall be payable on receipt of advance payments irrespect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... der proposed by Member (Technical), the facts are not being repeated so as to avoid redundancy. Ld. Member (Technical) has upheld the confirmation of interest by applying the provision of Rule 6 of the Valuation Rules for payment of Service tax on taxable services, on receipt of advance payment of the value of the said services. The appellant had not contested the demand and has paid the same. The only issue required to be decided in the present appeal is as to whether the appellant is liable to pay interest on the ground that they should have paid the service tax on lumpsum basis, on the introduction of service tax to Service net. 3. It is on record that the appellant was in touch with their jurisdictional Central Excise Officers and paid tax on monthly basis as per the advice of the jurisdictional Superintendent. In such a scenario, it cannot be held that there was any misstatement or suppression on the part of the assessee, with an intent to evade any dues. In fact, the ld. Member (Technical) has himself extended the benefit of Section 80 of the Finance Act and has set aside the penalties imposed upon the assessee, by observing that the appellants were acting under the instruc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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