TaxTMI 
TaxTMI 
2023 (5) TMI 766
X X X X Extracts X X X X
X X X X Extracts X X X X
....the respondent by the show cause notice dated March 01, 2017 issued for the period from April 2016 to January 2017. 2. The issue involved in this appeal is regarding non-payment of service tax on the amount paid to the Government or a local authority towards periodical charges for assignment of right to use of natural resource or quarry sand from the allotted mines. The Commissioner dropped the demand for the following reason: "51. Also, as per the terms and condition of the relevant agreements, the amount of the kadhan including royalty, rent etc. payable by the notice to the Govt. of M.P. were predetermined and the quantum and pattern of such payments was well defined by way of distributed installments in closed manner a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....TMI 1075-CESTAT New Delhi]. In regard to short payment of service tax on dead rent paid by the appellant to the State Government, which was taxable on a reverse charge basis against the receipt of services concerning grant of mining rights, the Bench held that for the purposes of levying service tax, the taxable event is construed at the time the service is provided or agreed to be provided. Therefore, in order to determine whether levy of services tax is applicable on a particular activity, it is necessary to determine the point of time when such activity is provided or agreed to be provided and since the agreements between the appellant and the State Government regarding grant of mining right were executed prior to April 01, 2016, on whic....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ded or agreed to be provided. In the present case, the agreement between the appellant and State Government for grant of mining rights was executed on 02.01.2016 and on this date, the transactions involving) assignment of right to use natural resource was not taxable. 17. In this connection section 66D of the Finance Act, as it existed prior to 01.04.2016, can be referred to and it is as follows: "66D The negative list shall comprise of the following services, namely:- (a) services by Government or a local authority excluding the following services to the extent they are not covered elsewhere- (i) services by the Department of Posts by way of speed post, express parcel post, life insurance and agency serv....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rounds taken in the memo of appeal, particularly to ground no. 9.6 to contend that since the payments were received after April 01, 2016, the appellant would be liable to pay service tax. The said ground is reproduced below: "9.6 On going through the agreements it has been observed that all the contracts/agreements (for each sand quarry) have been executed allotted prior to the relevant date i.e. 01.04.2016 (the date of Levy of Service Tax), for assignment of right to use of natural resource of such sand quarry on periodical charge (yearly basis in the name of the kadhan to be paid in four installments every year on 1st day of the quarter i.e. 01.04.2016, 01.07.2016, 01.10.2016 & 01.01.2018 for the year 2016-17 and similar/ identic....