Point of taxation - Continuous supply - The appellant contended ...

Service Contract Ruled as Continuous Supply, No Tax Until Milestones Met; Tax Demand Overturned.

April 12, 2024

Case Laws     Service Tax     AT

Point of taxation - Continuous supply - The appellant contended that their service contract with ONGC was a continuous supply of service and that the point of taxation had not been triggered, as they had not yet delivered oil/gas to ONGC. They argued that the activities undertaken were intermediate steps toward fulfilling the contract's scope and did not constitute a taxable service per se, as they had not yet received consideration for the supposed services rendered. - The tribunal found merit in the appellant's arguments, emphasizing the nature of the contract as a continuous supply of service, where taxation could only be applied upon the completion of specific milestones. - Demadn of service tax set aside.

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