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Issues involved: Service Tax demand under the category of "Business Auxiliary Service" for the period from October, 2009 to May, 2009. Demand of Service Tax on incentives received by the applicant for achieving targets given by service receivers.
Service Tax Demand under "Business Auxiliary Service": The applicant, engaged in travel agent services, faced a Service Tax demand of &8377; 53,92,092/- for using software provided by M/s. Amadeus. The Revenue claimed that the incentive received for software usage promoted M/s. Amadeus' business, making the applicant liable for Service Tax under "Business Auxiliary Service." Applicant argued they were only software users and not service providers to M/s. Amadeus. The Tribunal found that by using the software, the business of M/s. Amadeus was promoted, upholding the Service Tax liability. However, as the applicant believed they were not providing a service, the extended period of limitation was deemed not applicable, directing a pre-deposit of &8377; 9,00,000/-. Short Payment of Service Tax: The applicant contended that they had paid excess Service Tax in earlier periods, which was adjusted in the impugned period, justifying the short payment. The Tribunal agreed that the earlier excess payment was sufficient for the pre-deposit requirement, waiving the need for further pre-deposit on this count. Incentive Receipts for Achieving Targets: The Tribunal recognized that the applicant was entitled to exemption under Notification No. 22/97 for incentive receipts related to achieving targets. Consequently, the Tribunal found merit in waiving the pre-deposit requirement on this account as well. Conclusion: The Tribunal directed the applicant to make a pre-deposit of &8377; 9,00,000/- within eight weeks, with compliance due by 10-10-2013. Upon compliance, the need for pre-deposit of the remaining amount of Service Tax, interest, and penalty was stayed during the appeal's pendency.
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