TMI Blog2009 (1) TMI 202X X X X Extracts X X X X X X X X Extracts X X X X ..... he Appellant. V. Poorna Chandra Rao for the Respondent. [Order per : M.V. Ravindran, Judicial Member .] - This appeal is directed against Order-in-Original No. 01/2007-ST, dated 31-1-2007. 2. The relevant facts that arises for consideration are during the period 1-4-2005 to 15-6-2005, the appellant had provided the service of maintenance and repair of ships to the customers and they had not taken Service Tax registration and were not discharging the appropriate Service Tax liability. It was noticed by the lower authorities that the contracts contained all the terms and conditions for carrying out maintenance and repairs of ship. The quotations were agreements and the liability of payment of Service Tax arises in those cases. Com ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Finance Act, 1994 read with the provision under sections 91 and 95 of the Finance (No. 2) Act, 2004. (2) I order that interest at the appropriate rate shall be paid by the party on the above amount of tax confirmed, under section 75 of the said Act. (3) I also impose a penalty calculated @ Rs.100 (Rupees one hundred only) under section 76 of the said Act for every day during which period failure to pay service tax continues so, however, that the penalty shall not exceed the amount of service tax that they failed to pay. (4) I also impose a penalty of Rs.1,000 (Rupees One thousand only) under section 77 of the said Act for failure to file ST-3 Return under section 70 of the said Act read with rule 7 of the Service Tax Rules, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot disputed that they do not have any maintenance contract with their customers. In these circumstances, the Government's circular referred to supra by the learned advocate is clearly applicable. In other words, in the absence of a maintenance contract prior to 16-6-2005, the appellants are not liable to pay service tax. The Director General of service tax has given some clarification, the Adjudicating Authority has relied on the same without putting the appellant to notice. This is bad in law. Moreover, the clarification of the Director General is contrary to the instructions of the Government. The entire period of dispute is prior to 16-6-2005. After the amendment on 16-6-2005, the appellant is paying service tax. It has been clarified by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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