Appeal allowed pending verification of taxable services value. Produce evidence of Service Tax payment. Department to verify documents.

The appeal was allowed, subject to verification by the Adjudicating Authority of the actual receipt of the value of taxable services during the relevant period. The judge found merit in the Revenue's argument that the respondent must produce evidence of paying Service Tax on the actual amount of interest received, directing them to provide the necessary documents for verification. The order was modified to include this directive, with the Department instructed to verify the documents as directed by the Commissioner (Appeals). The appeal was disposed of with these terms, emphasizing the need for proof of tax payment on the actual interest received.

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Issues:

- Whether Service Tax is payable on the amount of taxable services shown in the Balance Sheet or the actual interest received by the respondents.

Analysis:

The appeal was filed by the Revenue against the Order-in-Appeal No. 115-CE/MRT-I/2008, where the Adjudication Order was set aside, and the appeal was allowed subject to verification by the Adjudicating Authority of the actual receipt of the value of taxable services during the relevant period. The main issue in this case revolved around whether Service Tax is payable on the amount of taxable services shown in the Balance Sheet or the actual interest received by the respondents.

During the hearing, the Revenue's representative argued that the respondent failed to produce the necessary records to support their claim that they had paid the tax on the interest actually received by them. The representative further contended that the respondent should provide proof of actual receipt of payment, such as cheques and drafts, for verification. It was emphasized that the respondent did not present any evidence in this regard.

Upon careful consideration of the arguments presented, the judge found merit in the Revenue's submissions. Consequently, the impugned order was modified to direct the respondent to produce the required documents before the Original Authority to demonstrate that they had paid the Service tax on the actual amount of interest received from their clients. The Department was also instructed to verify these documents as directed by the Commissioner (Appeals). The appeal was disposed of based on these terms, and any cross objections were also resolved accordingly.

The order was dictated and pronounced in the open court on 17-3-2009, bringing the matter to a conclusion with a clear directive for the respondent to provide the necessary documentation for verification regarding the payment of Service Tax on the actual interest received.

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