TaxTMI 
TaxTMI 
2025 (6) TMI 763
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.... the appellant is liable to pay service tax at the enhanced rate of 4% of the taxable income realized under works contract service for the period on or after 01.03.2008 and thus sustained the demand of Rs.1,26,358/- along with interest and penalty imposed by the Order in Original No.99/2010 dated 31.12.2010 impugned therein; thereby rejecting the appellant's appeal to that extent. 2. Briefly, the facts are that the appellant is registered with service tax department as providers of commercial or industrial construction services and construction of residential complex services. During scrutiny of their ST-3 returns, it was noticed that the appellant had discharged service tax at 2% under works contract services on the value of taxab....
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.... the order of Adjudicating Authority to the extent aforementioned. Hence this appeal. 5. Shri K. Parthasarathy, Ld. Advocate appeared and argued for the appellant. The Ld. Counsel submitted that the Appellate Authority has failed to note that the rate to be adopted for taxation purposes was the rate in force on the date of provision of services and not the rate in force on the date of receipt of money consideration for the services provided. He submitted that the appellant has paid service tax at 2% for the services rendered up to 29.02.2008, as that was the rate prescribed under the Rules in force, during that period. The Ld. Counsel submitted that Section 83 of the Act read with Section 38A of the Central ....
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....ndisputed that the appellant has paid service tax at the rate of 2% for the services provided by them before 01-032008. The sole issue to be decided is whether for such services rendered prior to 01.03.2008, for which the payment was received after 01.03.2008, whether they are liable to pay service tax at the enhanced rate of 4%. 9. We find that this Tribunal has dealt with such an issue on an earlier occasion as can be seen from the decision in CCE, Salem v. M/s URC Constructions Pvt Ltd, 2018 (5) TMI 888- CESTAT CHENNAI. Relevant portions are as under: 5. The demand is raised alleging that the respondent has received the payments after 01.03.2008 and therefore is liable to pay service tax @ 4%. During the disputed period....
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....tive. Looked at from another angle, a circular which is contrary to the statutory provisions has really no existence in law." 11. It is obvious that the said instruction being contrary to the law as declared by the Supreme Court can have no existence in the eye of the law. As a result we declare the instruction dated 28-4-2008 to be invalid. Consequently, the show cause notices and all the demands raised against the petitioner which are impugned in these writ petitions are also invalid. 12. The learned counsel for the respondent had argued that the petitioner has an alternative remedy by way of appearing in the adjudicatory process as also by way of an appeal as provided under the statute. However, we do not agree with thi....