TaxTMI 
TaxTMI 
2023 (6) TMI 848
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....ents and such packages are priced on the basis of sessions / sittings required by the respective clients. The entire costs of these packages are collected in advance from their clients for the services that have to be provided subsequently. The service tax rates were revised from 8% and further revised to 12.24%. The appellant discharged service tax @ 8% for the disputed period. The allegation of the department is that the appellant ought to have paid service tax at the enhanced rate on the portion of services that were provided or to be provided after which the rates were revised. Show cause notices were issued for different periods proposing to demand service tax along with interest and for imposing penalties. After due process of law, th....
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....vided after which the rates were revised. Ld. Counsel submitted that the said circular has been withdrawn by the department. The circular clarifies about the payment of service tax on such service which becomes taxable subsequently. In the present case, the service provided by the appellant was already taxable and the appellant was discharging service tax. The rate of service tax only has been revised. The appellant is liable to pay the increased rate only @ 12.24% only from 18.04.2006. The period of dispute in the present case is from 10.09.2004 to 15.06.2005. The demand raised alleging that the appellant is liable to pay service tax at the enhanced rate w.e.f. 10.09.2004 cannot sustain. 4. Ld. Counsel relied upon the decision in the case....
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....rcular issued in 2003 without taking this change in law into account. 10. For a harmonious construction of the relevant provisions it is necessary to quote them. They are quoted below : '65(105) "taxable service" means any service provided or to be provided' - as defined in the various clauses. "66. Charge of service tax - There shall be levied a tax (hereinafter referred to as the service tax) at the rate of eight* per cent, of the value of taxable services referred to in sub-clauses (a) .... ,.... ,... ,....." (this rate was increased w.e.f. 10-9-2004) "67. For the purposes of this Chapter, the value of any taxable service shall be gross amount charged by the service provider for such service provided or to be provided by him". ....
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....ection to such payment in advance. So at a later date when the rate went up, there is no reason for the department to turn around and say that the Appellant should not have paid tax in advance. So we do not find it proper to rely on this explanation to conclude that the rate of tax as prevalent at the time of providing service (This date itself is not a clear date in this case) will apply. We are of the view that during the relevant time the rate that was applicable at the time of receipt of value of service will apply in a case where the assessee chose to pay tax on the advance amount received. 13. We also take note that provisions in Rule 4(b)(ii) and Rule 9 of the new Point of Taxation Rules, 2011 as amended by Notification 25/2011-S.T....