2017 (5) TMI 342 - AT - Service Tax

Valuation - includibility - whether the amount collected by the appellant under the name of registration charges or handling charges from the customers over and above the legal charges, viz., smart card and vehicle registration fees for getting the vehicle registered with the RTO authorities, etc. is chargeable to service tax or otherwise? - Held that - the same issue in the appellant s own case 2016 (1) TMI 738 - CESTAT MUMBAI , has been decided by this Tribunal in their favor, and was held that the RTO charges and extra charges related thereto does not fall under the support service of business or commerce - appeal allowed - decided in favor of appellant.

Summary

Issues Involved:
Whether the amount collected by the appellant under the name of registration charges or handling charges from customers over and above legal charges for vehicle registration is chargeable to service tax or not.

Detailed Analysis:

Issue 1: Taxability of Extra Charges Collected by Appellant
The primary issue in this case revolved around determining the taxability of the additional charges collected by the appellant from customers for services related to vehicle registration. The Tribunal analyzed the definition of Business Support Services under Section 65(104c) of the Finance Act to ascertain whether the extra charges fell within the ambit of taxable services. The Tribunal held that the collected amount did not align with the services specified in the definition of Business Support Services. The appellant's act of collecting extra charges was not considered as falling under the category of customer relationship management services, as interpreted by the first appellate authority. The Tribunal emphasized that the definition of Business Support Services did not encompass the services rendered by the appellant, even under the residual category of "other transaction processing."

Issue 2: Precedents and Consistent Tribunal Decisions
The Tribunal referred to previous decisions, including the appellant's own case and judgments in similar cases like Sehgal Wheels Pvt. Ltd. and My Car Pune Pvt. Ltd., to support its conclusion. These precedents established a consistent view that charges related to vehicle registration do not qualify as Business Support Services for taxation purposes. By citing these precedents, the Tribunal emphasized that the issue was no longer open to debate (res integra). The Tribunal, therefore, relied on the consistent interpretation provided by previous decisions to set aside the impugned order and allow the appeal in favor of the appellant.

In conclusion, the Tribunal's analysis focused on interpreting the relevant legal provisions to determine the taxability of extra charges collected by the appellant. By considering the definition of Business Support Services and relying on established precedents, the Tribunal concluded that the charges in question were not subject to service tax. The decision was based on a thorough examination of the legal framework and consistent judicial interpretations, ultimately leading to the setting aside of the impugned order and allowing the appeal in favor of the appellant.