Chartered Accountant
Bookmark and Share
click here to subscribe our newsletter
 
 
Corporate News *   CBIC issues draft rules for Customs valuation *  Top Headlines: Threshold for Benami deals, green bond investors, and more *  Govt aims 1-hour clearance for goods at all ports *  Exporters Allowed To Use RoDTEP, RoSCTL Scrips To Pay Customs Duty, Transfer Them; Rules Amended *  Millions of labourers to be affected by brick producers’ strike over hike in GST, coal rates *  Inauguration of ‘kendriya GST parisar’ *  Transporter can seek Release of Conveyance alone, not Goods under GST Act: Madras HC *  GST: Quoting of DIN Mandatory for Responding to Notice, Govt Modifies Portal *  Firms can soon file claims for GST credits of ?400 cr *  CBIC issues modalities for filing transitional credit under GST. *  Mumbai: Man creates 36 fake GST firms, arrested for input tax credit fraud of Rs 23 cr *  Report to restructure Commerce Ministry under study; idea is to set up trade promotion body: Goyal *  Firms can soon file claims for GST credits of ?400 cr *  Gambling Alert! Govt May Levy Up To 28% GST; UP, Bengal Back Move *  EPFO backs raising retirement age to ease pressure on pension funds *  India Moving Up Power Scale, Set to Become Third Largest Economy By 2030 *  Airfares Get Expensive: What Changes for Flyers From Today? *  IRCTC Latest News: Passengers to Pay More For Cancelling Confirmed Rail Tickets Soon. *  IBC prevails over Customs Act, says Supreme Court. *  As GST enters sixth year, a time for evaluation and reassessment *  There’s GST on daily essentials as Centre needs money to buy MLAs: Arvind Kejriwal *  Now, GST on cancellation of confirmed train tickets, hotel bookings *  GST kitty for top States could rise 20% in FY23, says Crisil *  French customs officials seize another cargo vessel over Russia sanctions *  TradeLens builds on Asia momentum with Pakistan Customs deal *  Hike tax on tobacco, reduce affordability & increase revenue: Civil society organizations to GST council *  Bihar: ?10 crore tax evasion on tobacco products detected in raids *  Centre failed on GST, COVID; would it be anti-national? Rajan on Infosys row *  Service Tax not Chargeable on Income Tax TDS portion paid by recipient: CESTAT grants relief to TVS *  Foreign portfolio investors make net investment of Rs 7575cr in Sep so far
Subject News *  Run-up to Budget: Monetary threshold for GST offences may rise to Rs 25 cr *   GST (Tax) E-invoice Must For Businesses With Over Rs 5 Crore Annual Turnover *   Both Central GST and excise duty can be imposed on tobacco, rules Karnataka high court *   CBIC Issues Clarification On Extended Timelines For GST Compliance *   CBIC Issues Clarification On Extended Timelines For GST Compliance *  Budget 2023- 9.6 crore gas connections *  GST: Tamil Nadu Issues Instructions for Assessment and Adjudication Proceedings *  GST: CBIC Extends Last Date for filing of ITC *  GST collection in September surpasses Rs 1.4 lakh crore for straight seventh time *  Dollar smuggling case: Customs chargesheet names M Sivasankar as key conspirator. *  Hike in GST rates fuels inflation *  Assam: CBI arrests GST commissioner in Guwahati *  GST fraud worth ?824cr by 15 insurance Cos detected *  India proposes 15% customs duties on 22 items imported from UK *  Decriminalising certain offences under GST on cards *  Surge in GST collections more due to higher inflation: India Ratings *  MNRE Notifies BCD and Hike in GST Rates as ‘Change in Law’ Events But With a Condition | Mercom India *   Solar projects awarded before customs duty change allowed cost pass-through *  Rajasthan High Court Dismisses Writ Petitions Challenging Levy Of GST On Royalty *   GST revenue in September likely at Rs 1.45 lakh crore *  Govt working on decriminalising certain offences under GST, lower compounding charge *  Building an institution like GST Council takes time, trashing is easy: Sitharaman *  GST collections in Sept may touch ?1.5 lakh crore *  KTR asks Centre to withdraw GST on handlooms *  After Gameskraft, More Online Gaming Startups To Receive GST Tax Claims *  Madras HC: AAR Application Filed Under VAT Does Not Survive After GST Enactment *  Threshold for criminal offences under GST law may be raised *  Bengaluru: Gaming company faces biggest GST notice of Rs 21,000 crore *  CBIC clarifies Classification of Cranes for GST, Customs Duty *  Customs seize gold hidden in bicycle in Kerala airport  

Comments

Print   |    |  Comment

PJ/Case Law /2016-17/3231

Tax rate applicable on date of rendition of service is relevant.
Case:-COMMISSIONER OF SERVICE TAX, DELHI VERSUS BAGAI CONSTRUCTION
Citation:- 2016 (41) S.T.R. 433 (Tri. - Del.)
Brief Facts:- Stay petition along with appeal has been filed by Revenue against the Order-in-Appeal No. 223/ST/D-I/2012, dated 22-11-2012 in terms of which service tax demand of Rs. 13,25,005/- confirmed along with interest and penalties by the primary adjudicating authority was set aside.
The issue involved in this case essentially is that the appellant paid service tax under the Works Contract Service @ 2.06% under Composition Scheme on the ground that service was rendered before 1-3-2008 although the payment was received after 1-3-2008, while the primary authority held that the correct rate of tax was 4.12% which was the rate applicable on the date of receipt of payment. The impugned demand arose as a result of the above dispute.
Appellant’s Contention:-The ld. DR agreed that the said judgment of Delhi High Court covers the issue.
Respondent’s Contention:-It is contended by the respondent that the issue is no longer res integra and is settled by Delhi High Court in the case of Vistar Construction (P) Ltd. v. Union of India & Ors. - 2013-TIOL-73-HC-DEL-ST = 2013 (31) S.T.R. 129 (Del.).
Reasoning Of Judgement-The court has considered the respondent’s contention and find that in the case of Vistar Construction (supra), the Delhi High Court has held that “the taxable event, in so far as service tax is concerned, is the rendition of the service. That being the position, the taxable events in the present writ petition had admittedly occurred prior to 1-3-2008. At that point of time the rate of service tax applicable in respect of the services in question was 2% and not 4%, which came into effect only on or after 1-3-2008. Therefore the rate of tax applicable on the date of which the services were rendered would be the one that would be relevant and not the rate of tax on the date on which payments were received.” The Delhi High Court in that judgment further held that the “TRU Circular F. No. 545/6/2007-TRU, dated 28-4-2008 is contrary to law as declared by the Supreme Court and therefore has no existence in the eyes of law”.
In the light of the issue having been settled in favour of the respondent by the said judgment of Delhi High Court in the case of Vistar Construction (supra), we find no merit in the Revenue’s appeal. Therefore the stay petition and appeal are dismissed.
Decision:-Appeal dismissed.
Comment:- The crux of this case is that as per the Delhi High Court decision in case of Vistar Construction (P) Ltd. v. Union of India & Ors,sincethe taxable event in relation to service tax is the rendition of the service, the rate of tax applicable on date of rendering service is to be applied. Therefore, the tax rate applicable on the date of which the services were rendered would be relevant and not the rate of tax on the date on which payments were received. The Delhi High Court in that judgment further held that the TRU Circular F. No. 545/6/2007-TRU, dated 28-4-2008 is contrary to law as declared by the Supreme Court and therefore has no existence in the eyes of law.
Prepared By:- Neelam Jain
 
Department News


Query

 
PRADEEP JAIN, F.C.A.

Head Office : -

Address :
"SUGYAN", H - 29, SHASTRI NAGAR, JODHPUR (RAJ.) - 342003

Phone No. :
0291 - 2439496, 0291 - 3258496

Mobile No. :
09314722236

Fax No. :0291 - 2439496


Branch Office : -

Address:
1008, 10th FLOOR, SUKH SAGAR COMPLEX,
NEAR FORTUNE LANDMARK HOTEL, USMANPURA,
ASHRAM ROAD, AHMEDABAD-380013

Phone No. :
079-32999496, 27560043

Mobile No. :
093777659496, 09377649496

E-mail :pradeep@capradeepjain.com