TMI Blog2017 (8) TMI 71X X X X Extracts X X X X X X X X Extracts X X X X ..... held that enhancement of tax rate is not applicable to the polices issued prior to such enhancement - the enhancement of rate of tax on 10.9.2004 has no application to the facts of this case - appeal allowed - decided in favor of appellant. - ST/761/2009-CU(DB) - A/61371/2017-CU[DB] - Dated:- 26-7-2017 - Mr. Ashok Jindal, Member (Judicial) And Mr. Devender Singh, Member (Technical) For the Appellant : Shri Pulak Kumar Saha, CA For the Respondent : Shri Tarun Kumar, AR ORDER Per : Ashok Jindal The appellant is in appeal against the impugned order demanding differential amount of service tax on account of revision of rate of service tax after 10.9.2004. 2. The facts of the case are that the appellant is engage ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y issued prior to such enhancement. Therefore, the impugned order is to be set aside. 4. On the other hand, learned AR relied on the Notification No. 5/2004-ST dated 9.7.2004 and also relied on the decision of Reliance Industries Ltd. Vs. CCE, Rajkot - 2008 (10) STR 243 (Tri.-Ahmd.) and in the case of Consulting Engineering Services (I) Pvt.Ltd. - 2013 (30) STR 586 (Del.) 5. Heard both sides and considered the submissions. 6. We find that the facts of the case are not in dispute. As all the contracts for annual maintenance have been entered prior to 10.9.2004 and the amount towards service tax were paid by the appellant at the rate of prevalent during the said period. On 10.9.2004, the rate of service tax has been increased ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... stance, the service tax is payable at the rate when the services provided by the assessee. Therefore, the relying on such decisions also, it is fact that when the service is being provided rate prevalent at that time is applicable. Admittedly, in the case in hand, rate of service tax was 8% when the annual maintenance contracts were entered by the appellant with their clients and the service was reckoned prior to 10.09.2004. The service is rendered as and when the contract is entered. The similar issue has been dealt by this Tribunal in the case of Bajaj Allianz General Insurance Co.Ltd. (supra) wherein this Tribunal has observed as under: 15. It can be noticed from the above re-produced provision of the Insurance Act that the in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s under Hire Purchase Scheme. When the appellant got registered under Section 69 of the Finance Act, 1994 for providing services under the category of Banking and Other Financial Services, the rate of Service tax was 5% w.e.f. 14-5-2003, the rate was enhanced to 8%. For all Hire Purchase Contracts entered prior to 14-5-2003, the appellant remitted Service tax at the rate of 5%. Revenue proceeded against the appellants on the ground that the appellant is required to remit Service tax @ 8%. The original authority confirmed a demand of ₹ 44,054/- under Section 73 of the Finance Act. The Commissioner (Appeals) upheld the order of the original authority. The appellants are aggrieved over the impugned order. Shri T.M. Sreedharan, the l ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he hire-purchaser receives the payment subsequently by an EMI (Equated Monthly Instalments) but Service tax liability is discharged on the date of signing the hire-purchase contract as per the prevalent rate of service tax, the analogy/logic, will be also applicable in this case, as the CBEC vide Circular dated 2-5-95 clarified as under :- Premium on insurance - The question of collection is at issue here in the following categories of premium paid on insurance - (a) Premium paid in advance i.e. payment of premium has been received, where as the risk is covered after 1-7-1994. (b) Payment of premium in instalment i.e. some installments of the premium have already been received prior to 1-7-1994 while some more are to be rece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Tribunal in an identical circumstances on enhanced service tax liability held that enhanced rate is not applicable for the amounts subsequently collected as EMI. In this case the appellant is on a more stronger footing, as the premium is received in advance and no further amount is collected, as in the cases of Art Leasing Ltd. (supra) and LFC Hire Purchase Company Ltd. (supra). 8. We find that this Tribunal in the case Bajaj Allianz General Insurance Co.Ltd (supra) has held that enhancement of tax rate is not applicable to the polices issued prior to such enhancement. In that circumstance, we hold that in the case in hand, the enhancement of rate of tax on 10.9.2004 has no application to the facts of this case. Therefore, t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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