TaxTMI 
TaxTMI 
2007 (1) TMI 56
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....iod. Interest under Section 75 has been demanded. Penalties under Section 75A, 76 and 77 have been imposed. Further, penalty of Rs. 18,07,99,483/- has been imposed under Section 78 of the Finance Act, 1994. The main allegation against the appellant is that during the above mentioned period, the appellants rendered the services under the category of 'Maintenance and Repairs Services' and failed to observe the statutory formalities and pay the appropriate service tax. Based on clarification issued by the Director General of Service Tax in his letter dated 15-6-2004, the Adjudicating Authority held that the appellants are liable to the pay Service Tax. The appellants have strongly challenged the impugned order. 3. Shri A.K.J. Nambiar, learned....
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....ioner has relied on a clarification from the Director General of Service Tax, however, the clarification was never put to the appellants. That apart, it is settled law that clarification issued by the Director General of Service Tax are not binding upon quasi judicial authorities. (v) The repair activities carried out by the appellants on the ships/vessels are in the nature of works contracts or lump sum contracts and there is no scope for vivisecting the same as to separate the same into service portions and supply portions for the purpose of levying Service Tax. (vi) The Show Cause Notice did not refer to specific instances of any willful suppression or misstatement of facts with an intention to evade payment of duty. Hence, longer peri....
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....e Tax has given some clarification, the Adjudicating Authority has relied on the same without putting the appellant to notice. This is bad in law. Moreover, the clarification of the Director General is contrary to the instructions of the Government. The entire period of dispute is prior to 16-6-2005. After the amendment on 16-6-2005, the appellant is paying Service Tax. It has been clarified by the Government that even if maintenance is carried out under any contract apart from other services, the appellant is not liable to pay Service Tax prior to 16-6-2005. In order to levy Service Tax prior to 16-6-2005, a pure maintenance contract is a must. In the present case, there is no evidence that the appellant had entered into a maintenance cont....