Service tax demand beyond the show cause notice and payable on realization led to rejection of the departmental appeal.

A departmental appeal against the Commissioner (Appeals) was found unsustainable where the order-in-original contained serious discrepancies, including confirmation of demand beyond the amount proposed in the show cause notice. The tribunal also noted that service tax became payable only on realization of charges, which supported the assessee's position. On these facts, the appeal was rejected and the order of the Commissioner (Appeals) was maintained in favour of the assessee.

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Issues: Whether the department's appeal against the order of the Commissioner (Appeals) was liable to be allowed.

Analysis: The order-in-original suffered from serious discrepancies, including confirmation of a demand in excess of the amount proposed in the show cause notice. The finding that service tax became payable only on realization of charges further supported the assessee's case.

Conclusion: The appeal was not sustainable and was rejected, with the order of the Commissioner (Appeals) maintained in favour of the assessee.

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