2010 (10) TMI 415

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....that during the course of audit, it was found that the respondent had received an amount of taxable service of Rs. 39,72,685/- and Rs. 26,95,750/- for the year 2003-04 and 2004-05 respectively on Management Consultancy. On scrutiny of their ST-3 returns provided by the respondent, it was alleged that they were required to pay service tax as per detailed below : - Year Amount of Taxable service payable realized @ Service tax  payable 2003-04 39,72,685/- 8% 3,17,814/- 2004-05 26,95,750/- 10.20% 2,74,966/-     Total 5,92,780/- Thereafter, it was observed that the respondents had paid the service tax amounting to Rs. 5,11,765/- during the impugned period whereas they were require....

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....tted that right from the beginning, they have supplied the required invoices and other documents to the adjudicating authority and adjudicating authority has confirmed the demand only on the basis of the rate applicable at the time of receipt of payments of services provided by them. In fact, when the service was provided, the invoices were raised, the service tax at that relevant time was either 5% or 8%. But the payment was realized by the respondents on the service provided as per invoices when the applicable rate was 8% or 10.2%. He also submitted that it is a settled law that service tax rate is applicable at the time when the services is provided to the client and not at the time of realization of payment of thereof. He further submit....

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....alization, therefore, the findings of the adjudicating officer that assessee has failed to prove that the remaining receipt of Rs. 1,00,000/- (9,00,000-8,00,000) belong to the period when the rate of service tax was 8% was not correct in as much during 1-4-03 to 14-5-03, the applicable rate of service tax was 5% and not 8%. Like wise their stand for the clearances to the extent of Rs. 2,33,750/- [in their defence para (ii) above], is also proper in as much during 1-4-04 to 18-8-04, they have effected valuable services to the extent of Rs. 6,66,250/- on which they have discharged the service tax to the extent of Rs. 53,300/- (being @ 8%). During this period the service tax was applicable at the rate of 8% upto 10-9-04 only and therefore, the....