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TMI Blog2019 (8) TMI 1026X X X X Extracts X X X X X X X X Extracts X X X X ..... uel etc. - also appellants submissions on limitation were not considered. The Commissioner should have gone through the submissions of the appellant and give his findings on the same before coming to a conclusion. The matter needs to go back to the commissioner for a fresh reconsideration of the issues in the light of the submissions made by the appellant and the interpretation given Tribunal and Courts as submitted by the appellants wherever applicable - Appeal allowed by way of remand. - Service Tax Misc. Application No.85418 of 2019 in Service Tax Appeal No.85672 of 2015, 85688 of 2015, 85625 of 2016 - A/86442-86444/2019 - Dated:- 20-6-2019 - Dr. D.M. Misra, Member (Judicial) And Shri P Anjani Kumar, Member (Technical) Shri Narendra Dave, Advocate for Appellant Shri Bidhan Chandra, ADC And Dilip Shinde, AC(AR) for Respondent ORDER Per : Shri P Anjani Kumar, Member (Technical) Brief facts of the case are that the Appellant is primarily engaged in transportation of passengers by air services, for domestic journeys, and hold a Non-Scheduled Operators Permit ( NSOP ) issued by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Reimbursement of fuel 72.12 BAFS 7.96 STGU 4.75 Reversal u/r 6(3) 21.00 In addition to the duty confirmed Equal penalty under Section 78 and late fee under Section 70 of the Finance Act, 1994 was also. 2. In respect of Appeal No.ST/85625/16 , the Learned Counsel for the appellants submits that the Appellants are primarily engaged in transportation of passengers by air services, for domestic journeys, and hold a Non-Scheduled Operators Permit ( NSOP ) issued by the Directorate General of Civil Aviation (hereinafter referred to as the DGCA ). It employs a fleet of around 22 helicopters ( Aircrafts ); the appellants are discharging service tax on the consideration received under the category ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r the taxable event, in the case of Supply of Tangible Goods for Use is the supply, i.e. transfer of custody of goods, that is the date of agreement; the event in the present case is therefore 16.04.2006, i.e. the date when the appellants entered into an agreement for supply of goods; However, the taxable category of Supply of Tangible Goods for User Services came into existence from 16.05.2008, much after the event has occurred, i.e. entering of agreement. Therefore, section 65(105) (zzzzj) of the Finance Act, 1994 will not be applicable in the present case. 3.1. In respect of demand of Service tax under Banking and Financial Services, the Counsel submits that department alleges that the appellants have received the Banking and Financial Services from the vendor located outside India for leasing of Aircrafts; the appellants entered into a lease agreement with CESNA(UK) on 15.06.2015;the agreement was amended and clauses related to option to purchase the asset was removed from the agreement Even though, the amended agreement was provided to the Ld. Commissioner, the Ld. Commissioner confirmed the demand relying on the clause of the Old agreement which was dele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er recording the same, the Ld. Commissioner mechanically confirmed the entire demand. However, for the demand of ₹ 4, 75,560/- the department took the figures from the financials, under the head Provisions and demanded tax under Supply of tangible goods for use . The appellants are providing continuous supply of service; in case of continuous supply, service tax is payable at the time of invoices are raised; appellants made provisions for the services for the purpose of accounting in 2011-2012; the invoices of the same were issued in subsequent months and service tax discharged thereafter; merely provisioning for the purpose of accounting does not trigger the service tax liability. 4.1. In respect of demand of Service tax under Banking and Financial Services, Learned Counsel submits that the department alleged that the appellants have received the Banking and Financial Services from the vendor located outside India for leasing of Aircrafts; appellants entered into a lease agreement with CESNA(UK) on 15.06.2005; agreement was amended in 26.4.2006 and clauses related to option to purchase the asset was removed from the agreement; Even though, the amended ag ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g the period the period 2009-10, 2010-11 and 2011-12,the Appellants prepared financials on the accrual basis; due to the difference in practice of ascertaining the revenue, the gross receipts were reconciled; appellants paid tax under Transportation of passengers by Air w.e.f. 1.7.2010; the taxable event, in the case of Supply of Tangible Goods for Use is the supply, i.e. transfer of custody of goods, that is the date of agreement. (iv). In respect of demand of Service tax under Banking and Financial Services, the agreement entered into a lease agreement with CESNA(UK) on 15.06.2015 was amended and clauses related to option to purchase the asset was removed from the agreement. But Ld. Commissioner confirmed the demand relying on the clause of the Old agreement which was deleted in the amended agreement. Further, the demand under Banking and Financial Services is not sustainable in accordance to the judgment of Bajaj Auto Finance Ltd. V. CCE. 2007 (7) S.T.R. 423 (Tri. Mumbai) affirmed by Hon ble Apex Court in 2008(10) S.T.R. 433 (S.C.). The entire situation is revenue neutral, as held by Tribunal in Jet Airways Ltd. V.CCE 2016 (44) STR 465 (Tri- Mum) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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