2018 (2) TMI 144 - AT - Service Tax

Valuation - includibility - reimbursable expenses - Banking and Other Financial Services - Held that - the issue has been decided by the Hon ble High Court of Delhi in the case of Intercontinental Consultants & Technocrats Pvt. Ltd Vs UOI as well as CST Chennai Vs Sangamitra Services Agency 2012 (12) TMI 150 - DELHI HIGH COURT , where it was held that the reimbursable expenses not includible in the assessable value - impugned order does not call for any interference - appeal dismissed - decided against appellant-Revenue.

Summary

Issues:
1. Inclusion of reimbursable expenses in the total value of taxable services for service tax liability.

Analysis:
The appeal was filed by the Revenue against the order passed by the Commissioner (Appeals) setting aside the demand, interest, and penalties imposed. The issue revolved around whether reimbursable expenses should be included in the total value of taxable services for the purpose of discharging service tax liability. The department contended that such expenses, like conveyance and courier charges, incurred by the respondent while rendering services, should be included. However, the Commissioner (Appeals) had ruled in favor of the respondent, stating that reimbursable expenses are not includible in the total value of taxable services.

In response, the counsel for the respondent cited precedents such as the decision in the case of Intercontinental Consultants & Technocrats Pvt. Ltd. Vs UOI and the decision of the Madras High Court in CST Chennai Vs Sangamitra Services Agency, arguing that these supported their position. Additionally, reference was made to a Tribunal decision in Dream Loanz Vs CCE Coimbatore, which also favored the assessee on this issue.

Upon hearing both sides, the Tribunal noted that the issue had already been settled by the decisions of the Hon'ble High Court of Delhi and the Madras High Court, as well as by previous Tribunal decisions. The Tribunal emphasized the importance of judicial discipline and consistency in decisions, ultimately deciding not to interfere with the Commissioner (Appeals)'s order. It was also noted that the amount involved in the department's appeal was less than ?10 lakhs. Consequently, the appeal was dismissed, maintaining the ruling that reimbursable expenses are not to be included in the total value of taxable services for service tax liability.