2018 (4) TMI 1171 - AT - Service Tax

Rent-a-cab Operator Service - abatement claim - N/N. 9/2004 dated 09.07.2004 and 1/2006-ST dated 01.03.2006 and that under N/N. 6/2005-ST dated 01.03.2005 - Held that - on perusal of Explanation B to the said N/N. 6/2005-ST dated 01.03.2005, the said explanation authorizes exclusion of consideration received towards providing service which are exempt from whole of service tax leviable thereon - after excluding 60% consideration, the aggregate value of clearance for the years 2007-08, 2008-09 and 2009-10 in the present case is within the permissible limit for the exemption under the said N/N. 6/2005-ST dated 01.03.2005, which exempts taxable service from whole of service tax leviable under Section 66 of the Finance Act, 1994. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Interpretation of Explanation "B" of Notification No.6/2005-ST dated 01.03.2005 regarding exclusion of consideration for service tax calculation.

Analysis:
The appellant provided vehicles to M/s UPSRTC, leading to a demand for service tax based on the amount received. The appellant claimed abatement under various notifications to avoid service tax payment. The original authority dropped proceedings, but the Commissioner (Appeals) held that the abatement did not exempt the entire consideration from service tax. The Tribunal analyzed Explanation "B" of Notification No.6/2005-ST and found that 60% of the consideration, eligible for abatement, should be excluded from the service tax calculation. By excluding this amount, the aggregate value for the relevant years fell within the exemption limit under the notification. Consequently, the Tribunal set aside the Order-in-Appeal and allowed the appellant's appeal.