2013 (6) TMI 490 - AT - Service Tax

Service Tax Liability - who is liable to discharge - appellant submits that as per the definition under Section 65 (7) of the Finance Act, 1994 assessee means a person liable to pay service tax and includes his agent . As per the tripartite agreement, he has appointed three agencies as agents not only for the purpose of negotiating with the corporate for the services to be undertaken by him but also for the discharge of tax liability. Held that - service tax liability discharged through the agent is sufficient - the assessee includes his agent and therefore, if the tax liability has been discharged by the agent on the service rendered by his principal, that is sufficient for discharge of service tax liability by the principal. Therefore, following the decision in the case of Ms.Katrina R Turcotte (2012 (12) TMI 579 - CESTAT MUMBAI), we allow this appeal with consequential relief, if any. - Decided in favor of assessee.

Summary

Issues:
1. Appeal against order-in-appeal No. BR/90/2012 dated 06/09/2012 passed by Commissioner of Central Excise, (Appeals), Mumbai.

Analysis:
The appellant, a well-known Indian Cricketer, entered into a tripartite agreement where his agents negotiated with corporates on his behalf for promotional services. A notice demanding service tax from the appellant was issued, contending that he was the service provider and the service tax paid by his agents did not discharge his tax liability. The demand was confirmed by an order dated 17/11/2009, imposing penalties under Section 76, 77 & 78 of the Finance Act, 1994. The appellant's appeal before the lower appellate authority was dismissed, leading to the current appeal.

The appellant's consultant argued that as per Section 65(7) of the Finance Act, 1994, the agent is considered part of the assessee, and since the agents discharged the service tax liability, it constituted payment by the appellant. Citing a precedent involving Ms. Katrina R. Turcotte, the consultant contended that service tax liability discharged through agents is sufficient, and no additional demand can be made on the principal for the same transaction. The Addl. Commissioner (AR) agreed with this interpretation, referencing the Katrina R. Turcotte case.

After considering the arguments, the Tribunal concluded that if the tax liability has been discharged by the agent on behalf of the principal, it is deemed sufficient for the principal's service tax liability. Relying on the precedent set by the Katrina R. Turcotte case, the Tribunal allowed the appeal and any consequential relief. The stay application was also disposed of in favor of the appellant.