AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2024 (5) TMI 619
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....ows: - i) Alleged non-payment of service tax on mobilisation advance received. ii) Alleged short payment of service tax on the reconciliation of values shown in books of accounts with that declared in ST3 returns (this includes supplies made to SEZ). iii) Alleged short payment of service tax on GTA (as service recipient). iv) Alleged non-payment of service tax, on deferred and unbilled revenue (under erection, commissioning or installation service). v) Alleged non-payment of service tax on additional revenue (under works contract service). Sl. No. Allegations of nonpayment/ short payment SCN-1- (76/2013 dt. 18.10.2013 2008-09 to 2011-12) SCN-2- (79/2014 dt. 19.05.2014 2012-13 SCN-3 (41/2015 dt. 0.04.2015 2013-14 Total 1. On mobilization advances received 29,18,336 --- --- 29,18,336 2. Difference between trial balance and ST3 51,68,77,665 9,62,31,142 7,132,02,760 68,44,11,567 3. On GTA as service recipient 21,25,195 --- --- 21,25,195 4. On deferred & unbilled revenue under EC or IS 14,30,232 7,09,532 8,52,151 29,91,916 5. On additional revenue (under works contract service) 3,30,83,979 1,91,17,368 59,88,5....
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....tentions of the assessee. It took notice that service tax has admittedly been paid on the service portion in the mobilisation advances. The Learned Commissioner also examined some of the invoices for advance which were only for the cost of materials, wherein the description of invoice it was mentioned value of items delivery at site - 30% initial advance received adjusted. Thus there is no error in the finding of the Learned Commissioner. 6. Considering the rival submissions on the 1st issue we find that there is no dispute that the mobilisation advances in respect of Works Contract which is a composite contract involving supply of both materials and labour/service. We find Learned Commissioner have examined the issue and also taken notice that the appellant have admittedly deposited an amount of Rs. 8,39,433/- towards service tax on the service element in the mobilisation advances. The Learned Commissioner have categorically recorded the finding that some of the invoices for mobilisation advance are towards material supplied only. Further recorded that from the sample invoices produced, evidently the assessee have deposited the service tax on the service portion. Further the Lear....
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.... whereas service tax liability during the said period was on receipt basis. The SCN proposed to levy service tax by taking the entire amount shown in the profit and loss account, considering the same as the value of services rendered, without appreciating the fact that the figures were inclusive of value of materials and that service tax have already been discharged on the value of service. In terms of Section 67 the value of taxable service shall be the gross amount charged by the service provider for taxable service provided or to be provided. Further in terms of Sub Section (3) to Section 67, service tax can be levied only on amounts received towards taxable services when the invoices clearly show breakup of material and labour component and when VAT or sales tax is paid on the material portion and also reflected in the VAT/GST returns, service tax cannot be demanded on the material component. Further as per Rule 2A of Service Tax Determination of Value Rules, 2006, gross amount charged for the works contract shall not include value-added or sales tax paid or payable for transfer of property in goods involved. Further Notification No. 12/2003 dated 20.06.2003 provides for an exe....
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....equirement of notification would be against the provisions laid down in the SEZs Act. 17. The 3rd ground raised by revenue with respect to non-payment of GTA service tax as the recipient of service. Learned Special Counsel urges that on reconciliation of the taxable value of GTA service as per profit and loss account with that of declared value in ST3 returns for the period 2008-09 to 2011-12, there appeared to be short payment of fees Rs.21,25,195/-. It is urged that the adjudicating authority have held that the differential Value were accounted for at various other locations of the assessee and on which service tax was already discharged on accrual basis. Whereas in para-22.4 of the impugned order details of freight expenses as per trial balance, freight expenses relating to other locations, freight expenses pertaining to Secunderabad Centre and values adopted in ST3 returns and the difference are reflected. Whether service tax was paid by other locations was not made available for scrutiny during adjudication. What was done was random verification of the documents chosen and produced by the assessee. Does the differential tax have been wrongly dropped. 18. The Learned Counsel ....
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....consideration for service provided nor it was the payment received against any service provided, and therefore no service tax is leviable on the said amount. For the period prior to 01.04.2011 service tax was discharged on receipt basis on the total bill/received. An amount that the accounts reflected under accounting head as additional revenue is only a book adjustment for which they had neither raised any invoice not received any consideration. It is further urged that accounting for works contract is as per the procedure laid down in Accounting Standard - 7 issued by the Institute of chartered accountants of India. Service tax have been duly paid by the respondent as and when invoice has been raised on completion of an event/service in accordance with law prescribed in clause (i) of the proviso to Rule 3 of point of Taxation Rules, 2011 or on receipt of advance from customers. 22. Further urges in respect of deferred revenue in case of AMC the revenue for the contract is recognised based on the percentage of contract Completed during a particular financial year. However the invoices may be raised on the customer in advance at the start of the contract or at the beginning of eac....