9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2017 (5) TMI 698 - AT - Service TaxBusiness Auxiliary Service - money changers business - taxability - Held that - the relationship between the appellant and the TCIL is that of seller and purchaser and cannot be termed as principal and agent. Thus no service tax is leviable on the appellant on the charges received by it from TCIL - demand set aside. CENVAT credit - utilisation in excess of 20% as per Rule 6(3) of CCR 2004 - denial on the ground that the appellant had not produced any documents before them - Held that - Since the appellant submits that the documents are available with it we are of the view that the matter should go back to the original authority for verification of the documents - matter on remand. CENVAT credit - credit utilized exclusively for exempted service - the appellant submits that even prior to issuance of SCN the said amount alongwith interest was paid by the appellant - benefits of sub-section 3 of section 73 available or not? - Held that - the benefit of sub-section (3) of section 73 ibid should be available to the appellant for non issuance of SCN especially for imposition of penalty. Therefore penalty imposed on this count is set aside. Appeal allowed - part matter decided in favor of assessee and part matter on remand.
Issues involved:
1. Service tax demand on money changers business 2. Disallowance of cenvat credit Analysis: 1. The issue in the Revenue's appeal was whether the income earned by the appellant on foreign exchange surrendered to Mass Group India Ltd. is taxable under Business Auxiliary Service (BAS). The Ld. Commissioner concluded that the appellant is not liable to pay service tax on the income margin earned from this transaction. The contract analysis showed that the appellant purchased foreign currency from customers and sold it to TCIL, indicating no principal-agent relationship between the parties. 2. The Revenue contended that the appellant was appointed as an agent of TCIL, but the transaction was determined to be sale/purchase proceeds, not commission as a commission agent. Therefore, it did not fall under the scope of a commission agent for the purpose of service tax under BAS. 3. The assessee's appeal involved two issues. Firstly, denial of cenvat credit exceeding 20% under Rule 6(3) of Cenvat Credit Rules, 2004. The appellant argued that some services fell under Rule 6(5), allowing full credit irrespective of use for exempted output service. However, no documents were produced to support this claim. Secondly, denial of cenvat credit for common input services shared with another entity. The appellant claimed to have documents to demonstrate the quantum of services shared. 4. Regarding the denial of cenvat credit exclusively for exempted services, the appellant had paid the amount along with interest before the show cause notice (SCN) was issued. The appellant sought the benefit of sub-section 3 of section 73 to avoid penalty. 5. The Tribunal found that the relationship between the appellant and TCIL was that of seller and purchaser, not principal and agent, exempting the appellant from service tax on charges received. The matter of denied cenvat credit was remanded to the original authority for verification of documents. The penalty for the cenvat credit utilized for exempted services was set aside due to prior payment and non-issuance of SCN. In conclusion, the Revenue's appeal was dismissed, and the assessee's appeal was partly allowed to set aside the penalty. The matter of cenvat credit was remanded for further verification.
|
