2025 (11) TMI 1981

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....ed 18.07.2012 passed by Commissioner of Customs Central Excise and Service Tax Hyderabad - II Commissionerate. 2. A Show Casuse Notice in O.R.No. 258/2010 ST (Adjn) dated 22.10.2010 was issued by the Commissioner of Customs, Central Excise and Service Tax, Hyderabad - II Commissionerate for an amount of Rs. 1,91,63,640/-, towards Service Tax, along with interest, under Section 73(1) and Section 75 of the Finance Act, 1994 and also proposed imposition of penalty under Section 76 of the Finance Act, 1994. 3. The appellant contested the allegations and filed like their reply by dated 07.12.2011. 4. After hearing of the parties, The Commissioner of Central Excise Hyderabad - II Commissionerate has passed the Order-in-Original conf....

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....nstead of calculating on the service tax payable . Thus, the appellant have arrived at this calculation on correct computation which worked out to at a meager sum of Rs. 4,04,926/- in place of Rs. 1,15,59,343/-, as confirmed in the OIO. 8. Learned Counsel for the appellant submits that for the first time the "advances" were brought under levy of Service tax when the 'Point of Taxation Rules, 2011' introduced vide Notification No. 18/2011-ST dated 01.03.2011. In this appeal, period of dispute relates to year 2009-2010, whereas, 'Point of Taxation Rules 2011' come into force thereafter. Therefore, mobilization advances was not taxable service at that time. 9. Learned Counsel for the appellant also stated that the issue of....

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....uced vide Notification No. 18/2011-ST dated 01.03.2011. Rule 3 of the said rules read as follows: "3. Determination of point of taxation.- For the purposes of these rules, unless otherwise stated, "point of taxation‟ shall be determined in the following manner, namely:- (a) a provision of service shall be treated as having taken place at the time when service is provided or to be provided; and (b) if, before the time specified in clause (a), the person providing the service issues an invoice or receives a payment, the service shall, to the extent covered by the invoice or the payment made thereof, be deemed to have been provided at the time the invoice was issued or the payment was received, as the case may be, ....

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....the work to be done merely because the recipient and payee happened to be the provider of service. The payment of 'mobilisation advance' is but a separate financial transaction within the contract for providing of service and, within the limits laid down by the Hon'ble Supreme Court in re Intercontinental Consultants and Technocrats Ltd., is not permitted to be included in the 'gross amount' envisaged in Section 67 of Finance Act, 1994." 17. In the case of Thermax Instrumentation Ltd., supra, CESTAT Mumbai observed and held that; "Therefore, it is not towards value of services provided. The advance is proportionately transferred to sale/consideration of service in the books as and when the appellant raised invoices on the custom....