Service tax on imported consulting services failed for lack of a charging provision during the relevant period.

Service tax on Consulting Engineer's Services received from a foreign company could not be demanded from the Indian recipient for the period June 1999 to June 2002 because the recipient's liability had not been created under the law then in force. The relevant rules were amended only later, and the statutory provisions were brought into effect subsequently. In the absence of an applicable charging provision for the impugned period, the demand was unsustainable and the order was set aside in favour of the assessee.

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Issues: Whether service tax could be demanded from the recipient in India for Consulting Engineer's Services received from a foreign company during the period June 1999 to June 2002.

Analysis: The recipient's liability to pay service tax for services received from abroad had not been created during the relevant period. The relevant rules were amended only later, and the statutory provisions were amended subsequently as well. In the absence of a charging provision applicable to the impugned period, the demand could not survive.

Conclusion: The demand was unsustainable and the order was set aside; the appeal was allowed in favour of the assessee.

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