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Service Tax - Case Laws
Showing 181 to 200 of 30966 Records
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2025 (2) TMI 956
Levy of service tax or VAT - deemed sale - activity of renting out cinematographic equipment by the appellant - transfer of "right to use" the equipment - HELD THAT:- Under Section 66 of the Finance Act, 1994, there shall be levied a tax at the rate of 12% of the value of the taxable services referred to in subclause (zzzzj) of clause (105) of Section 65 of the Finance Act, 1994. The “taxable service” means any service provided or to be provided to any person, by any other person in relation to supply of tangible goods including machinery, equipment and appliances for use, without transferring right of possession and effective control of such machinery, equipments and appliances. Therefore, where right of possession and effective control is transferred, then it will not be a taxable service. Consequently, if it is not a taxable service, then certainly service tax is not leviable under Section 66 of the Finance Act, 1994.
There is not only a transfer of right of possession, but also effective control. The order-in-original has proceeded on an erroneous interpretation of the provisions of this agreement that possession and effective control has not been transferred to the hirer. This conclusion of the adjudicating authority not gareed upon. It is clear from the agreement that the equipments have been supplied for hire and possession and effective control has been transferred to the hirer.
The possession and effective control has been transferred. If it is not so, why will the owner reserve a right to inspect the equipments as and when required. If the possession and effective control is still with the owner, he would not need the hirers' permission to inspect. If effective possession and control has not been transferred, why the hirer has to make it known to the owner regarding loss or destruction or damage, after such loss or damage occurs - If possession and effective control is still with the owner or has not been transferred to the hirer, why would the hirer make a statement that he has taken inspection of the goods and he is satisfied with the condition thereof and the owner shall not be liable for any defects.
Conclusion - There shall be a deemed sale where there is transfer of the right to use any goods for any purpose – whether or not for a specified period, for cash, deferred payment or other valuable consideration. From the documents and particularly from the clauses reproduced above, it is quite clear that there has been a transfer of the right to use equipments for valuable consideration. Even in clause 29A of Article 366 of the Constitution of India, the only requirement is there should be transfer of the rights to use the goods for valuable consideration. Factually, there has been.
The order-in-original cannot be sustained, as it was without jurisdiction. The same is quashed and set-aside - Appeal disposed off.
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2025 (2) TMI 955
Recovery of service tax with penalties - order issued without examining the relevant charging section of the Finance Act, 1994, particularly Section 66B - violation of principles of natural justice - HELD THAT:- In the present case, the adjudicating authority has held that the petitioner contravened the provisions of the Act and the Rules made thereunder with an intent to evade payment of service tax. So far as the case of Amadeus India Pvt. Ltd. [2019 (5) TMI 669 - DELHI HIGH COURT] is concerned, in the said case, the Hon’ble Delhi High Court was dealing with a case in which the SCN issued on 4th September, 2018 to the petitioner-company was challenged. The fact of the matter was that on 3rd October, 2018, the petitioner drew attention of respondent to the master circular dated 10th March, 2017 read with an instruction dated 21st December, 2015 issued by the CBEC in terms of which a pre-show-cause notice consultation was mandatory in cases involving demand of duty above Rs. 50 lakhs.
A reminder was again sent by the petitioner on 13th November 2018. When no response was received, the writ petition was filed in the High Court of Delhi on 13th December, 2018. It appears that Hon’ble Delhi High Court not only entertained the writ application but also rejected the contention of the respondent that since the SCN was preceded by a search that was conducted in the business premises of the petitioner and the petitioner also rendered itself liable for penal action ‘for suppression of facts and contravention of various statutory provisions with intent to evade payment of due service tax’ and other incidental levies, the SCN partakes of the character of an ‘offence related’ SCN and therefore falls within the exceptions carved out under para 5.0 of the master circular.
In the case of Cosmic Dye Chemical [1994 (9) TMI 86 - SUPREME COURT], the matter reached to the Hon’ble Supreme Court only after final adjudication by the Tribunal failed. The Tribunal in the said case had taken a view that regardless of intent, a mere suppression of facts or misstatement in the information statutorily required to be supplied to the Excise authorities attract the larger period of limitation.
Conclusion - All the issues which have been raised by learned counsel for the petitioner in the present writ application would essentially involve appreciation of facts emerging from the records which may be duly gone into by the appellate authority. It is not the case of the petitioner that he has no equally efficacious remedy, we would, therefore, refrain from exercising our extra-ordinary writ jurisdiction at this stage.
Application disposed off.
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2025 (2) TMI 954
Liability of sub-contrator to pay service tax, when main contractor has paid the service tax - Invocation of extended period of limitation - suppression of facts or not.
Whether in case the main contractor has paid the service tax, the appellants are required to pay service tax on the services rendered by the appellants being sub-contractor, or not? - HELD THAT:- Admittedly, the appellant is a service provider and they are required to pay service tax on the services rendered by them as clarified by CBEC Circular No.96/7/2007-ST dated 23.08.2007, wherein it has been clarified that for the services rendered by the sub-contractor, the sub-contractor is required to pay service tax - the appellant is liable to pay service tax as demanded.
Whether the extended period of limitation in the facts and circumstances is applicable or not? - HELD THAT:- Admittedly, without investigation, it could have been revealed that whether the appellants are providing man power services to the main contractor or not nor after investigation, it came to the notice to the Department that the appellant is providing man power services and entitled in not to pay service tax. It is a fact on record that the appellants did not take service tax registration also. In that circumstances, unless and until, there is a bonafide act on the part of the appellants, the extended period of limitation has rightly invoked.
Conclusion - The appellants are liable to pay service tax as demanded and that the extended period of limitation was rightly invoked.
There are no merit in the appeals filed by the appellants - appeal dismissed.
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2025 (2) TMI 953
Exemption from service tax - advisory services provided by the appellant to JCB UK - export of service under Rule 6A of the Service Tax Rules, 1994 or not - place of provision of service - HELD THAT:- In the instant case, it is not disputed that JCB (UK) is a company incorporated under the laws of United Kingdom and is located in United Kingdom. Therefore, the UK office of JCB would qualify as its business establishment where decisions pertaining to the company are taken. Consequently, the services rendered by the Appellant would be considered as received at the 'business establishment of JCB UK' in terms of Rule 2(i)(b)(i) of the POPS Rules. Accordingly, the ‘location of the recipient of service' for purposes of Rule 3 would be United Kingdom, which is outside the taxable territory of India.
The taxability of such transactions, where rendition of service resulting in business growth in India, stands decided in favour of the appellant by the Larger Bench of the Tribunal in the case of M/S. ARCELOR MITTAL STAINLESS (I) P. LTD (NOW KNOWN AS M/S. ARCELOR MITTAL DISTRIBUTION SOLUTIONS INDIA PRIVATE LIMITED) VERSUS COMMISSIONER SERVICE TAX MUMBAI-II [2023 (8) TMI 107 - CESTAT MUMBAI-LB] wherein the Tribunal held 'It is, therefore, clear that the recipient of service is the person at whose desire the activity is done in exchange for a consideration, i.e., the person who is obliged to make payment for the service. The recipient of service would, therefore, be a person at whose instance and expense the service is provided, whether or not he is the beneficiary of the service.'
From the above, in the context of the present case, it is noted that the recipient of the service is JCB, UK who is also the person at whose desire the activity is done in exchange of monetary consideration.
Conclusion - The services rendered by the appellant were exports, thus not subject to service tax.
The impugned order is set aside - appeal allowed.
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2025 (2) TMI 952
Taxable service - retained portion of the freight collected from the oil companies - It is common ground that the freight charged for such activity was either exempted from tax or excluded for taxability in the respective tax regimes before and after 1st July 2012 - HELD THAT:- The essence of ‘business auxiliary service’ which is the intended target of tax, is the presence of a provider of service between a service/product belonging to one and required by another. The retained amount has been sought to be taxed by the fitment of carriage of cargo belonging to oil companies by vessel belonging to others as acting on behalf of oil companies, from contract, and causing receipt of service from vessel owners to oil companies. From a perusal of the impugned order, it would appear that the adjudicating authority has examined the contract, at least of a particular customer with the appellant herein and corresponding contract of appellant herein with owner of a vessel under on flag of Liberia.
The appellant as well as the oil companies are located in the territory of India with consequential location of the ‘provider of service’, which, in this case, is the appellant would render the tax liability to arise within the taxable territory of India; this aspect was never in dispute. However, ‘address commission’ is amount contractually withheld by the appellant and, while that may arithmetically be the difference between that received as ‘charter charges’ and paid as ‘charter charges’, is also the amount payable by the ‘vessel owner’ to the appellant as ‘commission’ for recourse to those vessels. It would, therefore, amount to consideration paid by the overseas entity to the appellant and either recompense for provision of service which was not considered by the adjudicating authority or unaccounted payment. In the haste to fall back on Place of Provision of Service Rules, 2012 for fastening liability, this aspect appear to have been overlooked.
Conclusion - In view of the inadequacy in the impugned order and such inadequacy precluding us from determining the tax liability to be legal and proper a fresh finding within the framework of the show cause notice and the contention of the noticee along with appreciation of legal authority for charging of tax under section 66 of Finance Act, 1994 and section 66B of Finance Act, 1994 in the respective periods is warranted.
Matter remanded back to the original authority for a fresh decision.
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2025 (2) TMI 951
Imposition of duty on plant and machinery imported from abroad - invocation of exended period of limitation - revenue neutrality - HELD THAT:- In the instant case the duty was paid of its own by the party in 2013 with interest. This conduct itself justifies that there was no intent to evade duty on the part of the appellant as has indicated by the learned advocate. Even on their discharge of the duty there were entitled to credit of the same and were allowed the department therefore they would have not benefitted in avoiding the taxes. He also pointed out that the taxes paid in 2013 were given credit of by the department of its own, as per law indicating that action resulting in S.C.N. was not an enforcement action. Revenue neutrality existed in the present case and delay in payment has been compensated by paying interest.
The extended period has been incorrectly invoked in the facts and circumstances of the matter. Therefore, on limitation the matter does not stand. The party become entitled to relief on limitation both for extended period as also for penalty. This court is not committing on merit of the case.
Appeal allowed.
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2025 (2) TMI 902
Exemption from service tax - services provided to the government for public health purposes - Entry No.25(a) of Mega Exemption Notification No.25/2012-ST - HELD THAT:- The Appellants have provided vehicles for transportation of Doctors, Paramedics and health workers for carrying out their day to day work in the National Health Mission. Therefore, the provision of vehicles to personnel engaged in execution of National Health Mission etc. by the Appellant is to be construed as any service rendered to Government in relation to public health.
The services provided by the Appellants, involving the transportation of health professionals for the National Health Mission, fell within the exemption under Notification No.25/2012-ST.
The Original Authority was correct in holding that the services rendered by the Appellants are not taxable - The impugned order is set aside and the appeal is allowed.
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2025 (2) TMI 901
Taxability u/s 66A of the Finance Act, 1994 - Manpower Recruitment or Supply Agency service - services consumed entirely abroad - service recipient - appellant or liaison office of the appellant or USA based clients of the appellant - Extended period of limitaton - penalty - HELD THAT:- The appellants are a company incorporated in India and having registered office in India and are also having liaison office at Pittsburgh, USA and other places in USA. The appellants are engaged in the business of export of ITSS, on which they have not been paying service tax, as such, because the export of service is exempt. The appellants have entered into contract service agreements for providing ITSS with various clients like American Solutions Inc., M/s Wilington, M/s Inalytix and M/s Financial Oxygen, etc., whereas, for providing such services directly at the offices of the clients, the appellants have also entered into professional services sub-contract agreements with service providers like Plutus Solutions Inc., Rpasoditech Inc., SK Tech Inc., Princeton Infotech and Virtue Group, all located in USA and the manpower provided by these contractors were deployed only at client’s site in USA.
Hon’ble High Court of Allahabad in the case of Glyph International Ltd Vs UOI [2011 (12) TMI 201 - ALLAHABAD HIGH COURT] clearly held that insertion of section 66A w.e.f. 18.04.2006 is legal and proper by holding that no demand can be made in terms of the said provision for the period prior to that date by way of certain rules and notifications issued under different sections like 68(2) or by way of insertion of explanation under section 65 etc., therefore, the validity of section 66A post 18.04.2006 is not in dispute.
Whether the plain reading of the provisions under section 66A read with Rule 3(1)(iii) of TSPOI Rules, 2006, requires that not only services should be received in India but should also be consumed in India for it to become covered by the deeming provision for the purpose of charging service tax on RCM or otherwise? - HELD THAT:- There is no dispute about legality of section 66A for the period post its introduction, as has been held by Hon’ble High Court of Bombay in Indian National Shipowners Association Vs UOI [2008 (12) TMI 41 - BOMBAY HIGH COURT] as well as by Hon’ble Allahabad High Court in the case of Glyph International Ltd Vs UOI. The issue before the Hon’ble High Courts was whether recipient of service in India is liable to service tax from abroad before 18.04.2006 or only after the said date after enactment of section 66A. The Hon’ble Bombay High Court held that service tax can be charged only after the enactment of section 66A, which was upheld by Hon’ble Supreme Court, whereas, charging of service tax on similar service for the period prior to the enactment of section 66A was set aside. In the case of Glyph International Ltd Vs UOI (supra), the Hon’ble High Court of Allahabad, inter alia, held that section 66A of the Finance Act, 1994 creates legal fiction to deem import of service so that the provisions of Chapter V can thereon be applied.
Demand of service tax on the consideration received from BSNL - HELD THAT:- In the present facts of the case, it is not alleged that they were engaged in either maintenance or repair service or WCS and the only ground was that they have provided BAS to BSNL on which service tax has not been discharged - in view of inclusive part of the definition, the taxable service of processing of transaction is also covered within the ambit of BSS. It is found that the view of the Adjudicating Authority is correct as it is not a mere printing activity rather it involves developing of software, deploying of man and machines, whereby, certain processing is done to generate a bill and if they would not have done this, then it would have to be done by BSNL themselves. Therefore, it is in the nature of BSS and not BAS or WCS, as being claimed by the appellant.
The impugned orders upholding the demand of Service Tax from the appellant in respect of non-payment of Service Tax under ‘Manpower Recruitment or Supply Agency Service’, non-payment of Service Tax under ‘Business Auxiliary Service’ on referral fee and commission paid to the service provider located outside India i.e., USA and non-payment of Service Tax under ‘Business Support Service’ provided to M/s BSNL, do not suffer from any infirmity and therefore, we do not find any reasons to set aside the impugned orders.
Extended period of limitation - Penalty - HELD THAT:- On going through these details, he observed that the liaison office system was in vogue for the appellant since 2001-02 and they have been claiming expenditure in their Annual Returns of the expenses incurred in connection with the operations of such liaison offices, which was, however, disallowed by the Income Tax department. This aspect further substantiates that liaison office was only an extended arm of Indian company, not having its own books of account, income/expenses or profit/loss. He has also relied on the chronology of sequences from start of audit till the issue of SCN, which clearly showed that last of the documents were submitted by the appellant only on 01.10.2010. Therefore, the Adjudicating Authority has taken into consideration all aspects and has dealt with extensively to come to the conclusion that in the given factual matrix, the invocation of extended period as well as imposition of penalty is maintainable.
Conclusion - i) The mere fact that the basic conditions that the service recipient should be located in India, service provider is located outside India and the services are received by the recipient would bring it within the ambit of section 66A. ii) Section 66A creates a legal fiction allowing the taxation of services received from abroad by an Indian entity, regardless of where the services are consumed. The recipient's location in India is sufficient for taxability. iii) The invocation of extended period as well as imposition of penalty is maintainable.
There are no infirmity in the impugned orders - appeal dismissed.
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2025 (2) TMI 900
Clubbing of vacant land into the value of services - Renting of Immovable Property Service (RIPS) - Non-payment of Service Tax - Rental Advances - Site Formation & Clearance Service - Commercial of Industrial Construction Service - Extended period of limitation.
Whether in the facts of the case the entire area for which separate agreements have been entered into by the appellants can be considered as land appurtenant to the warehouses or these are to be considered as standalone vacant lands, which cannot be part of the services under the category of RIPS?
Renting of Immovable Property Service - HELD THAT:- In terms of the agreement, which has been relied upon by the Adjudicating Authority, it is obvious that the dominant estate in this case would be the covered shed/warehouse and the open land/yard would be appurtenant to this covered shed/warehouse. It is obvious from the wordings of the agreement, especially, Annexure-2 to the agreement for covered warehouses that it has got no utility without the facilities like turning radius suitable for 40 feet trailers, land being not low lying and free from flooding, inundation, fencing all around the premises up to 4 feet height, entrance and exit gates on the main road side, etc. Therefore, the area under covered warehouses can be accessed and optionally utilized only with these facilities when the vacant land is also used in conjunction with the closed warehouse. Interestingly, the agreement is for covered warehouse approximately measuring 20,000 Sq Meter subject to certain conditions - a conjoint reading of the terms and conditions of these two agreements would show that the vacant land for which separate agreement has been entered into is nothing but land appurtenant thereto to the covered area/shed/warehouse. They are closely interlinked and interdependent. Thus, by relying on the definition of RIPS under section 65(105)(zzzz), the vacant land has to be considered as land appurtenant to the warehouses. Therefore, we do not find any infirmity in the impugned order confirming the demand on this count.
Demand on account of vacant land at A9 Industrial Area Kapparada, Kancherapalam, Visakhapatnam to M/s Avnash Automobiles Pvt Ltd - HELD THAT:- The appellants have a case because if there was no building at the time of leasing out the vacant land and if it was given prior to 01.07.2010, then there would not be any demand. The fact that they have constructed a building before hand, which was also let out to M/s Avnash Automobiles Pvt Ltd is also not clear. Therefore, this factual aspect needs to be examined by the Adjudicating Authority subject to appellant submitting the evidence to the effect that there was neither a building on the vacant land at the time of leasing out nor the provision for excluding vacant land from the purview of taxation was applicable at the time of leasing out. The fact that there were some other building for which no lease has been granted by the appellant to M/s Avnash Automobiles is obvious as the agreement is only for vacant land and there is no mention of any other agreement whereby the closed building, etc., was also given on lease. Therefore, merely because a land is appurtenant to any building, it will not get covered within the scope of service if building/shed has not been rented out. It is the other way round that where a building has been rented out, which also has land appurtenant thereto, then that land will also be included for the purpose of valuation of building. Therefore, this matter also needs to be remanded back to the Original Adjudicating Authority for redetermination of Service Tax liability.
Letting out of property located at S.No.51/1 B, IDA, Block-A, Mindi, Visakhapatnam to M/s Avnash Automobiles - HELD THAT:- There are much force in the ground that there is no strong evidence on record to suggest that just because certain buildings were existing, the entire land would be considered as land appurtenant to the building, especially, when the agreement is only with respect to vacant land and there is no other cogent evidence by the department to prove that the clients of the appellants were using both building and the land though showing only land in their agreement. Therefore, in view of the same, the demand would not sustain on this ground and it will be only a vacant land, which is not includable for the purpose of charging Service Tax under RIPS.
Exemption from Service Tax in respect of vacant land let out to M/s ATR Cars Pvt Ltd. - HELD THAT:- The Adjudicating Authority has clearly held that the appellants have let out only the vacant land appurtenant to the building and not the building and therefore, liable for exclusion from the definition of ‘immovable property’ under section 65(105)(zzzz) of the Finance Act, 1994. Merely because he was unable to exclude the income arising out of this property, no relief was given, which is not correct. The appellants are at liberty to show them the breakup of rents received from M/s ATR Cars and the Service Tax liability which has been included in the total liability needs to be excluded for the purpose of calculating the demand. Therefore, this also needs to be remanded back.
Non-payment of Service Tax during the period May, 2009 to Feb, 2010 - HELD THAT:- There is no doubt about the classification or the valuation and the only dispute is as regards amount payable and paid. As per the appellant, the entire Service Tax liability was discharged except for the interest liability on the delayed payment but the same was not accepted in view of the fact that appellant has not included rent received for the open land and that certain documents were also not submitted. Since the issue as regards classification and Service Tax leviability is not disputed, the only dispute is whether the total amount of Service Tax is paid with interest or there is some short recovery - Since it would require recalculation of amount as well as verification of certain documents, etc., and therefore, to this extent, the impugned order is set aside and the matter is required to be remanded back to the Original Adjudicating Authority for recalculating the total demand of Service Tax along with interest after allowing abatement for tax and interest already paid.
Rental advances - HELD THAT:- The demand has been confirmed on the ground that the said amounts cannot be treated as security deposit, inasmuch as the said amounts were actually rental advances which were adjusted on the monthly pro rata basis as agreed upon in the agreement between the appellant and the tenant. The Adjudicating Authority has also considered that there is a possibility that in respect of some of these pro rata payments, the Service Tax would have been paid at the time of payment of rent. However, the said submission of the appellant could not be verified as no supporting documents were available. Therefore, the entire demand has been upheld. The amount cannot be considered as security deposit, inasmuch as it has been applied continuously for discharging of rent, which is an admitted position and therefore, Service Tax would be leviable on the said amount. However, as the appellants are submitting that some of these amounts have already suffered Service Tax, this needs to be verified. Accordingly, this issue is also required to be remanded back for working out the net Service Tax payable.
Site Formation & Clearance Service - HELD THAT:- The services of muck cleaning and disposal is rightly classifiable under the category of SFCS. The appellants have not refuted the amount of Service Tax demanded by the department, which they have paid under Works Contract Service (WCS) and also certain portion under SFCS. Therefore, as far as the classification is concerned, there is no dispute that it is in the nature of SFCS. However, there is dispute as regards some of the amounts already paid under the category of WCS as well as under the category of SFCS. These amounts need to be adjusted against the total amount demanded from the appellant under this category. Therefore, this issue is also required to be remanded back to the Original Adjudicating Authority for recalculation.
Commercial of Industrial Construction Service - HELD THAT:- The Adjudicating Authority has not considered the abatement claimed by the appellant for calculating the total Service Tax liability while paying certain Tax liability under this category. The appellants could not put forth any evidence to claim having fulfilled the conditions for availing the benefit under Notification No.01/2006-ST dt.01.03.2006 and therefore, the same was denied by the Adjudicating Authority. Here, it is again felt that proper opportunities were not given to the appellant to adduce evidence in support of their claim for abatement in terms of Notification No.01/2006-ST. Therefore, this issue is also remanded back to the Original Adjudicating Authority for recalculation of Service Tax liability.
Time limitation - suppression of facts or not - HELD THAT:- The appellants have not canvassed any concrete reasons as to why the extended period should not be invoked in the factual matrix of this appeal. In fact, they have although been claiming that the demand itself is not maintainable on merit. They have also taken a plea from time to time that certain amount of service tax has already been paid by them, though not as per the demand made by the department. Therefore, having regards to submissions from both sides and the facts of the case, we find no infirmity in the order of the adjudicating authority holding that extended period is invocable in this case.
Conclusion - i) The vacant land leased by the appellant was appurtenant to the warehouses and subject to service tax under RIPS. ii) For SFCS and CICS, recalculation of tax liability is required, considering abatements and the nature of contracts. iii) The rental advances are part of the taxable value and required verification of payments to avoid double taxation. iv) The invocation of the extended period for demand upheld due to the appellant's failure to register and pay service tax timely.
Appeal allowed partly by way of remand.
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2025 (2) TMI 899
Cenvat credit in respect of input services used for exporting output services - denial on various grounds including their output service not being a taxable service as also on account of input services not having any nexus with the output service.
Whether in the absence of sufficient documents or description in the export invoice, can the service be treated as non-taxable or exempt service as such? - HELD THAT:- Admittedly, there is an agreement in terms of which many kinds of services are required to be provided to their parent company. However, there has not been any attempt to classify those services under the category of one or more taxable services, after going through the details of the said services. Therefore, apart from the services being claimed under BSS or ITSS, there could be possibility that some of these activities may not at all be in the nature of service or they would probably fall under some other service head. We also find that there is a clear provision under Rule 4A to give, inter alia, specific description of the services irrespective of whether it is meant for consumption within the country or abroad. Since they have used only abbreviated/short terms in their export invoices, the Adjudicating Authority was correct that it would not be possible for them to classify the same and since the appellant failed to convince the department that their export services are taxable, the next question would be whether the credits would also be not admissible in view of the fact that the services were exempted services, without resorting to proving any nexus or otherwise.
A great deal of services are covered within the category of agreements and covered within the schedule to the agreements. Schedule-A covers operational services: development, with generic description as development. The definition itself says that ‘to provide services and developmental support’ and gives certain examples. Merely by going through these services, one cannot arrive at proper classification during the pre-negative list regime where each and every activity has to be classified under specific heading of taxable services.
This is not the finalization of classification as proposed/submitted by the appellant, rather only an observation by the Commissioner (Appeals) and the entire matter was remanded back to the Original Authority for reexamination and to be decided on merit.
If they are treated as taxable service, can the credit be allowed if there is no nexus between the input service and the output service? - HELD THAT:- Since it is already held that the export service is non-taxable/exempt service, they have not gone into the issue of ineligibility on account of nexus between input and output services. It is seen the nature of services in respect of which the credit has been taken and find that most of these services would be eligible, in view of settled legal position. However, since this issue has not at all been discussed by the Adjudicating Authority even when the same was one of the grounds for denying the credit in the SCN, we feel that to that extent the impugned orders are non-speaking. More so, when some of these services may be having nexus, while some of them may not at all be having nexus with the output service.
Conclusion - The appeals are allowed by way of remand with direction that the Adjudicating Authority will go through the submissions both on the grounds of proper classification as well as the nexus before arriving at the final demand in case of inputs not having been considered eligible either on account of nexus or on account of concerned export service not being taxable service.
Appeals are allowed by way of remand.
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2025 (2) TMI 898
Refund of unutilized Cenvat Credit u/s 142(3) of the CGST Act, 2017, read with Rule 5 of the Cenvat Credit Rules, 2004, and Section 11B of the Central Excise Act, 1944, by virtue of Section 83 of the Finance Act, 1994 - Rejection on the ground that there exists no provision of refund of the balance Cenvat Credit in the Cenvat Credit Rules, 2004 - HELD THAT:- The decision of the Hon’ble Jharkhand High Court in the case of M/s Rungta Mines Limited [2022 (2) TMI 934 - JHARKHAND HIGH COURT] is exactly on the issue which is involved in the present case. The Hon’ble High Court after analyzing all the decisions cited before it, has come to the conclusion that under the existing law, cash refund cannot be granted of Cenvat Credit which is available on the appointed day i.e. 01.07.2017.
Conclusion - The appellant's failure to transition the Cenvat Credit and the lack of export activity precluded them from claiming a refund under the applicable legal framework.
Appeal dismissed.
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2025 (2) TMI 897
Recovery of service tax with interest and penalty - rent-a-cab service - period April 2006 to March 2009 - HELD THAT:- It is found that the stand of the adjudicating authority that the decision of the Tribunal on non taxability in identical circumstances was not valid precedent from non-acceptance of the decision on merit is erroneous. That the reviewing authorities did not consider the said decision as fit to contest in appeal either owing to the threshold prescribed by the Central Government under the Litigation Policy or for any other reason and does not detract from the applicability of such an order.
The Hon'ble Supreme Court, in re Kamalakshi Finance Corporation Ltd [1991 (9) TMI 72 - SUPREME COURT] has eloquently determined the mandate of judicial discipline and extraction of a contends of a circular of Central Board of Excise & Customs (CBEC) does not condone the demonstrated lack of judicial discipline. Nor can such circular purport to guide adjudication in a particular direction. It is also seen that the rejection was based upon a N/N. 4/2004 dated 31st March 2004 which preceded the Special Economic Zones Act, 2005. Section 51 of Special Economic Zones Act, 2005 renders the provisions of that law to prevail over any other statute in the event of conflict.
Conclusion - As the adjudicating authority has relied upon an outdated notification the final outcome not tenable warranting a fresh appreciation of proposals in the show cause notice in the context of settled law as well as exemption afforded by Special Economic Zones Act, 2005.
The matter remanded back to the original authority for a fresh adjudication within the framework of law - appeal allowed by way of remand.
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2025 (2) TMI 896
Invocation of extended period of limitation - appellant's turnover of services for the financial year 2015-16 was accurately reported or not - HELD THAT:- The plea is that settled law, in re Dinesh Chandra R Agarwal [2023 (11) TMI 1080 - CESTAT AHMEDABAD] and in re GD Goenka Pvt Ltd [2023 (8) TMI 995 - CESTAT NEW DELHI] that were adjudicated in identical or in near identical circumstances, precludes resort to extended period of limitation under section 73 of Finance Act, 1994 merely from such discrepancy. At this stage, it is not required to examine the applicability of these two decisions as the adjudicating authority has correctly pointed out that no steps were taken by appellant to rectify the statutory filings, which, according to their submissions in response to the show cause notice, was genesis of the dispute.
While neither adjudicating authority nor the Tribunal is concerned with the correctness of the records filed before other tax authorities, the inferences that may be drawn from the two records, neither of which were defended except by furnishing of details of sale of goods either independently or along with the services that is beyond the purview of Finance Act, 1994, is the foundation for rectification of one of the returns on the one hand or deficiency in one or the other on the other hand. Empowerment to invoke section 73 of Finance Act, 1994 extends from the obligation in section 70, read with section 68, of Finance Act, 1994 and not much different from the scope of normal assessment under section 72 of Finance Act, 1994 which enables obtaining of additional documents and evidence for re-determination of sum payable by an assessee.
Conclusion - It was incumbent upon the adjudicating authority to examine the details of the goods said to have been supplied either by way of sale or in the course of supply of service, that constitutes ‘trading’ and, thereby, excluded from the purview of taxability in Finance Act, 1994. Failure to undertake such exercise affects the credibility of the impugned order warranting remand back to the original authority for a fresh decision after taking note of the documents evidencing supply of goods which are not liable to be included in the value of taxable service for the disputed period.
Appeal allowed by way of remand.
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2025 (2) TMI 895
Denial of entitlement to refund of CENVAT credit accumulated - procurement of ‘inputs’ and ‘input service’ for undertaking ‘development of pharmaceutical stable coleman hydrochloride tablets’ under agreement with foreign entity that were claimed to have been exported - Failure to address the issue properly by appellate authority - Violation of principles of natural justice - HELD THAT:- The first appellate authority had not appreciated the issue in dispute before it which is essential in determining applicability of rule 4 of Place of Provision of Services Rules, 2012. Instead, the first appellate authority ruled on the taxability devolving on the appellant as ‘intermediary’, under rule 9 of Place of Provision of Services Rules, 2012, which was neither proposed in show cause notice nor proposed in appeal of jurisdictional Commissioner of Service Tax. In the light of the elaboration on ‘intellectual property rights’, there are no reasoning as to the manner in which such rights had been created in India. A right relating to ‘intellectual property’ is not, as expressed by the first appellate authority, a provision for incentivizing innovation but is very much for securing property in the manner peculiar to each national jurisdiction. It is not policy but a prescription in law and the vestment of such right must meet the test of law.
A right that is not registered in India cannot be deemed to have come into existence in the territory of India. The finding of the first appellate authority is, thus, mis-directed. The consequence in terms of allowing the appeal of jurisdictional Commissioner of Service Tax as well as rejection of the appeal of assessee lacks validity.
Conclusion - The impugned order is set aside and the matter remanded back to the first appellate authority for adjudging the validity of the grounds preferred by the respective appellants in accordance with the law as set out in Place of Provision of Services Rules, 2012 and judicial pronouncements now in place.
Appeals are allowed by way of remand.
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2025 (2) TMI 850
Constitutional validity of sub-clauses (zzzzv) & (zzzzw) of clause 105 of Sec. 65 of the Finance Act 1994 - authority of Parliament to introduce levy of service tax on certain services - appellants argue that the subject matter of impugned provisions of the Act in pith & substance would fall within the precincts of State Legislative power under Entries 54 & 62 of List II, Schedule VII of the Constitution of India - HELD THAT:- By virtue of the amendment, the services enumerated in the impugned clauses were brought within the Service Tax net, so that on and from the commencement of the Amendment Act, the services enumerated therein came to be subjected to levy of said tax. Entry 97 of List I is a residuary Entry under which Parliament is empowered to make laws in respect of any matter not enumerated in List II or List III, including any tax not mentioned in either of those laws. But Entry 54 of List II specifically deals with taxes on the sale or purchase of goods other than newspapers, subject to the provisions of Entry 92A of List I, is a subject on which the State Legislature can enact laws. Entry 97 of List I derives its powers from Article 248 of the Constitution which gives power to the Parliament to make a law imposing a tax, not mentioned in either of two other lists namely List II and III and therefore Service Tax is leviable by the part.
It has been well settled by now that there can be no question of conflict solely on account of two aspects of the same transaction being utilized by two legislatures for two levels, both of which may be taxes, fees or one which may be a tax and the other a fee falling within two fields of legislation, respectively available to them, as observed by the learned Single Judge at para 25 of the impugned order. There may be more than one taxable events in a single transaction, involving different kinds of taxes and different aspects of taxation.
The Apex Court in IMAGIC CREATIVE PRIVATE LIMITED vs. COMMISSIONER OF COMMERCIAL TAXES [2008 (1) TMI 2 - SUPREME COURT] has said that the payment of service tax and remittance of VAT are mutually exclusive, the nature of levies being different. Different aspects of a single transaction can be taxed under different statutes.
Conclusion - i) There can be levy of more than one tax on a subject matter, if incidence of each of the taxes is different from the other and such taxes may be imposed under different statutes. ii) Sales Tax can be levied by the State Government and the State Legislature is competent to enact law with regard to levy of Sales Tax. When State Government imposes tax on sale of goods, it does not do so on the service aspect of the sale. iii) The constitutional validity of the impugned provisions upheld.
Appeal dismissed.
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2025 (2) TMI 849
Refund of unutilized accumulated credit - rejection of refund claim as ineligible input service in terms of Rule 2(l) of Cenvat Credit Rules, 2004 being ‘no nexus’ with the exported output services without taking any recourse to Rule 14 ibid - HELD THAT:- An identical issue came up for consideration before this Tribunal in the matter of BNP Paribas India Solution Pvt. Ltd. vs. Commissioner of CGST, Mumbai East [2021 (12) TMI 676 - CESTAT MUMBAI] in which this Tribunal while allowing appeal of the appellant therein allowed refund claim under Rule 5 ibid by holding that since provision of Rule 14 ibid has not been invoked refund of cenvat credit, as claimed by the appellant under Rule 5, cannot be denied.
In the appellant’s own case State Street Syntel Services Pvt. Ltd. vs. Commissioner of CGST & Service Tax, Navi Mumbai [2023 (12) TMI 569 - CESTAT MUMBAI], while taking note of the decisions of this Tribunal, this Tribunal allowed the appeal of the appellant and held that denial of cenvat credit can be done by issuance of notice under Rule 14 ibid and it cannot be rejected solely under Rule 5 ibid.
It is settled principle that there cannot be two different yard sticks i.e. one for allowing the credit and other for deciding the refund and therefore the refund claim cannot be rejected on the ground of admissibility of the input service at the stage of processing of refund claim. Once credit when availed remains unchallenged, the assessee becomes entitled to the refund of the same in terms of Rule 5 ibid r/w Notification No.27/2012-CE (NT) dated 18.06.2012. The eligibility of input services to claim cenvat credit thereon cannot be questioned or examined during sanction of the refund claims, if the same was not challenged when it was availed on such input services.
Conclusion - i) Since Rule 14 was not invoked by the department, the refund of Cenvat credit claimed by the appellant under Rule 5 cannot be denied. ii) There cannot be two different yard sticks i.e. one for allowing the credit and other for deciding the refund and therefore the refund claim cannot be rejected on the ground of admissibility of the input service at the stage of processing of refund claim.
The impugned order is liable to be set aside - Appeal allowed.
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2025 (2) TMI 804
Invocation of extended period of limitation under proviso to section 73 (1) of the Finance Act - levy of mandatory penalty - suppression of facts or not - wrongful availment of Cenvat credit amount before discharging the service tax liability - eligible document to claim Cenvat credit under reverse charge mechanism as per rule 9(1) of CCR - HELD THAT:- The appellant having disclosed the availment of the Cenvat Credit for the month of October and November in the ST3 returns cannot be held liable for concealment of suppression of facts and therefore the extended period of limitation cannot be invoked. In view thereof it is wrong on the part of the revenue to say that the appellant had wilfully suppressed the material facts from the department with intent to wrongly avail Cenvat credit. As per the provisions of the Finance Act, the liability of the appellant was to file the STRs within the stipulated time disclosing the true facts and it is not the case of the revenue that they had not filed the STRs or had not disclosed the availment of Cenvat Credit. Hence, it is not a case of wilful suppression of material facts.
There is no averment in the show cause notice with reference to the factual matrix of the instant case, satisfying the presence of the ingredients of fraud, collusion, wilful misstatement, suppression of facts, or contravention of any of the provisions of this chapter or of the rules made thereunder with intent to evade payment of service tax. The burden is on the revenue which they have failed to discharge. The allegation of the revenue that the appellant had availed the Cenvat credit in contravention of the provisions of rule 4(7) is not sufficient to invoke the extended period as the violation has to be with reference to the intent to evade payment of duty.
Reliance is placed on the decision in Tamil Nadu Housing Board versus Collector of Central Excise [1994 (9) TMI 69 - SUPREME COURT], where the Apex Court held that extended period is invocable only if both the situations, suppression, fraud, collusion, etc. and intent to evade payment of duty is proved. Initial burden is on the department.
Even if it is held that there was an error on the part of the appellant in availing the credit, however the error was inadvertent as they were registered only in the month of September 2013 and therefore, the extended period invoked by the department is not justified. The principle enunciated in various decisions is that the proviso to section 73 (1) would be applicable on account of misstatement or suppression of facts only if the same was deliberate and for the purpose of evading payment of duty.
Levy of mandatory penalty - HELD THAT:- Revenue relied on the decision of the Tribunal in the case of Commissioner of C EX & ST–LTU, Delhi versus Gas Authority of India Ltd [2018 (12) TMI 91 - CESTAT NEW DELHI], to emphasise the plea that merely because the appellant is a public sector undertaking does not mean that mandatory penalty cannot be imposed once the invocation of the extended time limit has been upheld. Since it is already held that extended period of limitation cannot be invoked in the present case in the absence of the ingredients specified under section 73 of the Act, consequently, the penalty also cannot be imposed. Moreover, the facts in the said case are distinguishable from the present one, where the findings were to the effect that the appellant mis-classified the product as Naptha, on which much lesser excise duty was payable and therefore mis-declaration was held to be a strategy for tax evasion, and further the exemption claimed on the mis-declared product was held to be a positive act of misrepresentation of the facts. It was, therefore held that merely because the assessee is PSU is not sufficient to set aside the show cause notice as being barred by time.
Since the entire demand is beyond the normal period of limitation and it is held that the extended period is not invocable, the entire demand needs to be set aside on this ground alone. It is, therefore not necessary to further go into the merits of the matter. The question on merits is left open.
Conclusion - Due to the absence of deliberate intent to evade payment, the extended period and consequent penalties were deemed inapplicable.
Appeal allowed.
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2025 (2) TMI 803
Rejection of declaration under Voluntary Compliance Encouragement Scheme (VCES), 2013 - alleged tax liability on remuneration paid to part-time directors of the company - rule 2(1)(d)(i)(EE) of Service Tax Rules, 1994 - HELD THAT:- It is evident that the adjudicating authority has neither perused the terms of employment of the said directors nor examined the scope for appointment of whole-time employees as directors in the statutory framework governing companies. It is also not the case of the adjudicating authority that the whole-time directors were being remunerated with sitting fees in addition to contractual compensation. The additional tax liability has been fastened after the ‘negative list regime’ was made operational and influenced, unduly so, by the definition of ‘person liable for paying the service tax’ in Service Tax Rules, 1994 which is nothing but a machinery provision stemming from statutory delegation under section 68 of Finance Act, 1994. Such machinery provision is of significance to the tax scheme only upon determination of tax liability. The tax liability in the present instance could not have been determined unless with, and except by, reference to the contract of employment.
In the absence of such enquiry, and further finding thereof in the impugned order, the determination that the claim under the Voluntary Compliance Encouragement Scheme (VCES), 2013 is false, and, thereby, warranting discard is not tenable. Such casual and peremptory discard of relevant aspects of compensation detracts from the validity of the findings. It falls to the adjudicating authority to consider this aspect and upon determination that the said amount should have been included in the taxable service with section 2(1)(d)(ii)(EE) of Service Tax Rules, 1994 to be invoked for fastening tax liability attendant upon discard of claim for privilege under the scheme to enable which the proceedings will have to be restored to the original authority.
Conclusion - There is a need for a thorough examination of the terms of employment and contractual arrangements to establish the tax liability accurately.
The impugned order is set aside and the matter remanded to back to the original authority.
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2025 (2) TMI 802
CENVAT Credit - nexus of input services with the manufacture of final products/output services - Management Consultancy Service - Maintenance or Repair Service - Clearing & Forwarding Agent Services - Insurance Auxiliary Services - GTA-Outward Transportation Service - Courier services - Mandatory and Additional Inspection Service - business support services - Casting Error - recovery agent services - warranty handling service - Insurance Services for the plant, machinery and insurance for employees - subscription fees - Works Contract Service.
Management Consultancy Service - denial of credit on the ground that these services are related to gratuity valuation, superannuation valuation, leave encashment valuation, post-retirement valuation, etc., which are part of welfare measures for the employees - HELD THAT:- The services which are related to R & D facility, finance accounting and taxation etc., have been subsequently allowed in Order-in-Original No.10/2017-18 dated 29.01.2018. It is also stated that the services related to salary profile in terms of welfare measures was only denied for the later period. In view of the above, the matter is remanded for verification of the documents submitted by the appellant to examine whether the management consultant service is related to R & D, finance, trading, legal services, production management etc.
Management Consultancy Services - services on gratuity and superannuation funds - HELD THAT:- The Commissioner has allowed cenvat credit on most of the Management Consultancy Services except for service tax credit relating to services on gratuity and superannuation funds, which are basically related to the salary profile of the employees. The same is rightly denied since these services are not related to the manufacturing activities of the appellant; hence, it is disallowed.
Maintenance or Repair Service - HELD THAT:- This service is related to the services rendered by the dealers to the clients of the appellant and the dealers get reimbursement of the cost of these services. The services are of mandatory free services and maintenance services. Since, these services were actually provided by the dealers after the removal of final products at the customer’s premises, the service was an ‘input service’ for the customers of the appellant. Hence, the Commissioner held that it cannot be said to be a service which was used by the appellant and therefore, the service tax paid on such services cannot be availed as cenvat credit - credit allowed.
Clearing & Forwarding Agent Services - HELD THAT:- These services are related to packing of spare parts outside the factory premises used for repairs of excavators, which have been already cleared from the factory. Since the transaction value for the machine includes the cost of such repair and maintenance services on which excise duty has already been discharged and since it is within the warranty period, cenvat credit cannot be denied - credit allowed.
Insurance Auxiliary Services - HELD THAT:- These are the services which are related to medical insurance of employees, insurance of warehouse/branch office, transit insurance for space and car insurance used for sales promotion. Since, all these services are related to and add value to the manufacturing activities of the appellant and since the above services are also statutory requirement, they are eligible for the cenvat credit, hence allowed.
GTA-Outward Transportation Service - HELD THAT:- Transportation of goods from warehouse to customer’s site, the Commissioner has already allowed the credit for transportation of goods from factory to depot and denied only to the extent of transportation of goods from factory to the customers’ premises. The goods transported from warehouse to customer’s site from multiple centres at different places in India for maintenance or repair services have also been denied of cenvat credit since the services are rendered beyond the place of removal - It would be pertinent to place reliance on the decision rendered by the Larger Bench of the Tribunal in M/s. The Ramco Cements Ltd. vs. The Commissioner of Central Excise [2023 (12) TMI 1332 - CESTAT CHENNAI-LB], wherein the Tribunal had discussed in detail with regard to the issue on whether the cenvat credit on GTA services for outward transportation of goods from the factory to the buyer’s premises be denied in cases where the goods are sold on FOR (buyer’s premises or should such matters be remanded to the lower authorities for determining what is the place of removal - In view of the above Larger Bench decision, this issue is remanded to determine the admissibility of CENVAT credit on the GTA Service up to the place of removal.
Courier Services - HELD THAT:- The Commissioner has denied the cenvat credit on the ground that the courier service is used for transportation of materials from central warehouse to feeder warehouse and branches for replacement of materials under warranty or for providing maintenance or repair services. It is pertinent to refer to decision rendered in the case of CCE vs. CCL Products (India) Ltd [2009 (3) TMI 136 - CESTAT, BANGALORE], wherein it was held that various services including courtier services were rendered in respect to business activity. Hence, credit is allowed.
Mandatory and Additional Inspection Service - HELD THAT:- The appellant submitted that the cost of mandatory service inspection during the warranty period is part of their cost on which excise duty has already been paid. It is also stated that these mandatory services are provided to their customers to ensure that the consumable and critical items like filter and oil are replaced on the machine, the dealer raises a bill with service tax on which credit has been availed, hence submitted that for these mandatory services, cenvat credit cannot be denied. So also, the additional services are provided after the warranty period for which bills are raised along with service tax payment on which credit has been availed. Since, these services are rendered after clearance of the final products, on which Excise duty has been already paid and also, they are registered under “Maintenance and Repair Service”, hence, credit on this is allowed.
Business Support Service - HELD THAT:- These are services rendered by the dealers of the appellant after sale of goods and covered under the warranty service. Since the cost of warranty is included in the invoice value, on which tax has been discharged, the credit on this cannot be denied. Hence, it is allowed.
Casting Error - HELD THAT:- Since, no documents have been produced as to the services rendered under this category is either before the Commissioner nor heres, the same is denied for want of documents to prove the nature of service. On reimbursement of service tax, an amount of Rs.48705/- has been denied only on the ground that no documentary evidences have been provided having paid the tax. Since, nothing is also placed, the same is upheld.
Recovery Agent Service - HELD THAT:- These services have nothing to do with the manufacturing activities but relates to recovery of amounts unpaid by their customers, hence rightly denied.
Warranty Handling Service - HELD THAT:- These post-manufacturing services being part of the warrant period hence credit allowed. Club membership fees (Rs.3,240/-) is rightly denied in view of the fact that the membership fees and service tax paid on the club membership has nothing to do with the manufacturing activities of the appellant. The packing services (Rs.39,270/-) are meant for packing of parts locally procured which are used for maintenance and repair, which forms part of sale process and relates to packing of final products manufactured by them, which has nexus with the manufacturing activities, hence allowed.
Insurance Services for the plant, machinery and insurance for employees - HELD THAT:- Insurance Services for the plant, machinery and insurance for employees have all been allowed and what is disallowed is only those insurance policies that cover the family members of the employee that is to the extent of Rs.5,42,966/-. Since, the policies are related to the family members, this has been rightly denied.
Subscription Fees - HELD THAT:- This is the fees paid on taking membership of Indian Construction Equipment Manufacturer Association in order to participate in their exhibitions, in order to promote their products. The cost of which is included in the manufactured final product; hence, it is allowed.
Works Contract Service - HELD THAT:- The service tax credit has been denied only on the imported services related to civil works which are excluded from the definition of ‘input services’, the same is upheld.
Conclusion - Services directly or indirectly related to manufacturing activities and statutory requirements were generally eligible for credit.
Appeal allowed in aprt.
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2025 (2) TMI 801
CENVAT Credit - denial on the ground that the invoices were issued from an unregistered premises - various input services such as Architect services, Event Management services, etc. - Demand of service tax on training kits sales and whether these constitute commercial training or coaching - Demand of service tax on the sale of software declared as exempt in their books of account - Demand of service tax on services supplied to SEZ units and the applicability of exemption under N/N. 4/2004-S.T. - Limitation period for invoking extended period for demand and imposition of penalties under Section 78 of the Finance Act, 1994.
Whether the appellant is eligible for cenvat credit on the invoices issued from a premises which is not registered under their Centralized Registration Certificate? - HELD THAT:- There is no dispute that these premises were not registered under the Centralized Registration Certificate. The appellant’s claim is that the invoices from Mumbai Unit were addressed to their registered premises at Bangalore, hence the same cannot be denied. The cenvat credit is related to the invoice where the rent was paid for the premises at Mumbai (Bandra) which was claimed to be used for marketing activities.
There is no dispute of the fact that the appellant was well aware that all the premises that are used for the manufacturing/marketing purposes are to be registered under centralized registration procedures. Hence, the rent paid on the premises which is not registered cannot be availed as cenvat credit for the simple reason that there is no evidence as such that the above premises was used for marketing or providing any output services, except for stating that the premises used to facilitate business meetings with existing and prospective customers. In view of the specified procedures laid down under Centralized Registration Procedures read with Rule 4 (5) of Service Tax Rules, 1994 and in accordance with the Cenvat Credit Rules, the cenvat credit cannot be extended on rent paid on unregistered premises in both the premises of Mumbai. Similarly, the premises at Bangalore were rented for training purpose, space for support team, space provided for telecommunication service and for support activity. From the description of the activities, it is clear that in these premises also no output service activities undertaken except for renting them for various other purposes as mentioned above. Since, these premises have nothing to do with manufacturing/output services of the appellant the question of extending cenvat credit for these premises does not arise, hence rightly denied.
Eligibility of cenvat credit on services - Architect service - Authorized Service Station Service - Event Management Service - denial of cenvat credit on the above services only on the ground that there is no nexus between the input service and the output service rendered by the appellant - HELD THAT:- The convention services are also used for day-to-day business operations/meetings. Similarly, design services, event management services, etc., are all services in relation to the activities undertaken by the appellant. Since, individual invoices have not been verified to examine whether these were in relation to the operations rendered by the appellant, the matter remanded to the Commissioner only to examine whether these services were rendered in connection with the operations of the appellant, without questioning the one-to-one corelation. However, all invoices issued from the 6 premises not registered under Centralized Registration are to be denied.
Demand of service tax on training kits sales - HELD THAT:- From the observations of the Commissioner in the impugned order, there are no evidence or discussion on payment of VAT on the above participation fees, hence the same is remanded for deciding the issue afresh after considering the fact that VAT is discharged on the value collected as participation fees, taking into consideration the decisions relied upon by the appellant.
Demand of service tax on sale of software where the turnover is declared as exempt in their books of account - HELD THAT:- The appellant claims that this software was subject to VAT/CST and the recipient issues Form-C and based on the agreements the appellant carries out the replication of the software in a CD/DVD the same needs to be considered as exempted service. Since the agreements were not placed before the Commissioner to prove that they are exempted services, and the Commissioner observes that ‘the assessee failed to produce the entire documents during the audit in spite of several opportunities provided to them and always argued that they have claimed exemption in the ST-3 returns filed by them as the same is liable for VAT and not taxable under the Finance Act, 1994’ - the matter is remanded to the Commissioner for further examination based on the documents placed on record by the appellant to prove that VAT has been discharged on the above software.
Demand of service tax on services supplied to SEZ units - HELD THAT:- The period of dispute is from October 2008 to March 2009 and as rightly stated by the appellant they are eligible for the benefit of the exemption for the services rendered to the SEZ unit as per the Notification No. 4/2004 dated 31.03.2004. Since no documents were placed before the authorities that these services were used within the SEZ premises for the authorised operations, the same is being remanded for this limited purpose of verification.
Time Limitation - HELD THAT:- Unless any positive allegation of misdeclaration or suppression with intention to evade is brought on record the question of suppression cannot be alleged. In the instant case audit visited the unit in December 2011 and January 2012, the show cause notice was issued in 2014. The show-cause notice clearly mentions that a letter dated 08.02.2013 was issued to the appellant followed by letter dated 25.02.2013. The appellant in his reply to show-cause notice submitted that vide letter dated 04.02.2013 a list of documents was submitted which was already placed before the audit team and again vide letter dated 22.02.2013 further documents such as Software Distribution Agreement, Rental Agreement and sample purchase orders were filed. In response to the audit enquiry note dated 06.03.2013 a detailed reconciliation of expenses was filed vide their letters dated 09.05.2013 and 16.05.2013. In view of the above, since there is no allegation that regular returns have not been filed alleging suppression of any of the specific documents, the question of mis-declaration or suppression cannot be sustained.
Conclusion - i) Cenvat credit is disallowed for invoices from unregistered premises. ii) Other issues were remanded for further examination. iii) Since there is no allegation that regular returns have not been filed alleging suppression of any of the specific documents, the question of mis-declaration or suppression cannot be sustained.
Appeal disposed off.
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