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2016 (5) TMI 449 - AT - Service TaxDemand of Service tax - Deposits made by the appellant’s customers, in anticipation of the services to be received by them throughout the year - Appellant submitted that the deposits/advances made by the customers have fully discharged the service tax on the same either in the year of deposit or in the subsequent year, thus not calling for any further service tax. Also the part of the said demand is on the account of interest and to the extent of around ₹ 28 lakhs, the said interest stands confirmed on the ground that in terms of section 67 of the Finance Act any advance received from the customers for the services to be provided are required to be discharged service tax liability at that point of time only. Held that:- in respect of interest we are of the view that in terms of provision of Section 67 the service tax liability was required to be discharged at the time of the receipt of advances itself. The delayed discharged of such service tax as rightly, at this prima facie stage, accrued as interest liability against the appellant. In as much as, the appellant has not pleaded any financial hardship and we have observed against the assessee on the said legal issue for payment of interest the applicant is directed to deposit an amount of ₹ 60 lakhs towards the said liability within a period of six weeks from today. Demand of Service tax of ₹ 2.34 crores - Appellant was paying service tax as per the agreement under the category of renting of immovable property w.e.f. 01.06.2007 but the Revenue took the view that prior to 01.06.2007 the said service tax would fall under the category of franchisee services and raised the demand by invoking the longer period of limitation - Held that:- the appellant was paying service tax under the said agreement in respect of the said agreement. The appellant's contention is noted in as much as the entire facts were before the revenue and the payment of service tax under the category of renting of immovable property was being accepted by the Revenue without any objection, no malafide can be attributed to the appellant. Otherwise also it is found that the appellant is a central Government undertaking in which case it cannot be said at this prima facie stage that they were indulging in evasion of duty by suppressing any facts or by misstatement, with an intention to evade payment of duty. On this ground also prima facie case is found in favour of the appellant and accordingly dispense with the condition of pre deposit of the said amount. Demand of Service tax - Manpower recruitment or support agency services - Held that:- the said demands can be dealt in detail at the time of final disposal of the appeal. The appellant is directed to deposit an amount of ₹ 60 lakhs within a period of six weeks subject to such pre deposits and balance amount of duty and interest and penalty shall remain waived and its recovery stayed during the pendency of the appeal.
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