9911796707
TMI Blog2013 (7) TMI 96X X X X Extracts X X X X X X X X Extracts X X X X ..... ervice India Ltd., subsidiary of M/s. ONGC for drilling operation/drilling wells in the offshore waters of India during the period July 2009 to March 2010. However, they did not discharge any service tax liability on the consideration received on the services rendered during the impugned period. The department was of the view that the services undertaken by the appellant is classifiable under the category of "Supply of Tangible goods for use Services" and is taxable under Section 65(105)(zzzzj) of the Finance Act, 1994 with effect from 16/05/2008. Accordingly, a show-cause notice dated 15/12/2010 was issued to the appellant demanding service tax of Rs. 10,53,46,914/- along with interest thereon and also proposing to impose penalties under t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .2 The ld. Consultant further submits that their association, Petroleum Federation of India had submitted a representation to the Central Board of Excise & Customs vide letter dated 25/09/2009 seeking clarification as to whether they would be liable to pay service tax on the activity undertaken by them. A copy of the said representation was endorsed to Central Excise, Division-I, Mumbai vide letter dated 16/12/2009. Thus the department was aware of the activity undertaken by the appellant. The show-cause notice has been issued invoking the extended period of time and the demand has also been confirmed invoking the extended period of time. Since the department is aware of their activities, the show-cause notice is time barred. In these circu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nly vide letter dated 16/12/2009 whereas the show-cause notice in this case has been issued on 15/12/2010, i.e. within a period of one year from the date of letter intimating the activity by the appellant. Therefore, the date of knowledge is relevant in computing time limit. Thus, the show-cause notice is within time and therefore, the allegation of time bar is not sustainable. 4.2 The Ld. AR further submits that Notification No.1/2002-ST dated 01/03/2002 was amended vide notification No.21/2009-ST dated 07/07/2009 wherein the expression designated areas in the continental shelf and Exclusive Economic Zone of India as declared by the Notifications of the Government of India in the Ministry of External Affairs Nos. S.O.429 (E) dated 18/07/1 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eals that supply of machinery for execution of the work does not amount to transfer of the right to use the machinery and therefore, sales tax is not imposable on the hire charges on the machinery. In other words, the transaction involved is one of service. 5.2 From the agreement entered into between the appellant and ONGC, it is seen that compensation is fixed per day basis. Thus even when no drilling takes place, the service provider is compensated. Thus prima facie the service undertaken by the appellant falls under the category of "supply of tangible goods for use". As regards the issue of time bar raised by the appellant it is both a question of fact as well as law which can be considered at the time of final hearing of the appeal. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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