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2019 (2) TMI 1246 - AT - Service TaxLevy of service tax - immovable property given in settlement of agreement - operation and licence agreement - termination of the agreement - demand of service tax raised on the value of immovable property which was given to them as part of settlement deed - Held that:- After 18.4.2006, it can be seen that even if consideration is received as kind or other than money, the value of such kind other than money is also subject to levy of service tax. The value of any immovable property received as consideration would be subject to levy of service tax after 18.4.2006. In the present case, the appellants have received consideration in the nature of money as well as in the nature of immovable property. They paid up the service tax on the consideration received in the form of money. Even if the value of the immovable property is shown in the books of accounts in terms of money, it will not change the nature of the consideration received. The amendment brought forth with effect from 18.4.2006 makes it clear that prior to this date there was no intention to levy service tax on consideration received in the nature other than money. After the final settlement, undisputedly there has been no service provided by the appellant to SHRIL. Though part payments might have been received, such payments including the immovable property is for the services provided (or settled) upto 1.3.2006. It is also to be mentioned that prior to 2011, the service tax has to be discharged on receipt basis and not accrual basis. Though balance payments in the nature of money was received after 1.3.2006, the appellant is liable to pay service tax on such amounts since even prior to 18.4.2006 the consideration in money is taxable. For the immovable property received after 1.3.2006, there can be no levy of service tax since the provision of service is complete on 1.3.2006. The Board vide Letter No. 334/4/2006-TRU dated 28.2.2006, in para 8(1)(f) has clarified that the amendment to Section 67 proposes to include consideration received not wholly in terms of money. The demand of service tax on the value of immovable property to the tune of ₹ 30,60,000/- with the penalties thereon cannot sustain and requires to be set aside - As the assessee is not contesting the demand of service tax of ₹ 33,53,890/- with interest thereon, no interference is made in respect of this demand, however, penalty set aside. Appeal allowed in part.
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