|
Advanced Search Options
Service Tax - Case Laws
Showing 201 to 220 of 30966 Records
-
2025 (2) TMI 800
100% EOU / STPI - Classification of service - Manpower Recruitment and Supply Agency service or Consulting Engineer Service - time and material project - suppression of facts or not - invocation of extended period of limitation penalty.
Classification of service - HELD THAT:- The issue is no more res integra in as much as the agreements with M/s. Philips Electronics India Ltd. in the present case was similar to the agreement entered by M/s. Aztecsoft Ltd. with M/s. Philips Electronics India Ltd. in [2024 (7) TMI 312 - CESTAT BANGALORE] and this Tribunal on examination of these agreements had clearly held that the services rendered by the appellant is nothing but a ‘Manpower Recruitment and Supply Agency service’.
There are no reason to disagree with the decision and therefore, the demand of service tax as manpower supply service is upheld.
Extended period of limitation - suppression of facts or not - penalty - HELD THAT:- Since the ST-3 returns placed on record categorically show that they had declared the services rendered by them as exempted services under ‘Consulting Engineer Service’ and in view of the fact that the services were exempted till 16.05.2008 under consulting Engineer Service, the same cannot be considered as mis-declaration or suppression of facts. Hence, the impugned order is modified to the extent of confirming the demand for normal period and the penalties imposed under Section 76 and 77 are upheld and penalty imposed under Section 78 is set aside.
Conclusion - i) "Time and Material Projects" provided by the appellant constituted "Manpower Recruitment and Supply Agency Service", subject to service tax. ii) The appellant's classification of services as "Consulting Engineer Service" was based on a bona fide interpretation of the law, and there was no willful suppression or mis-declaration. The extended period of limitation was not applicable due to the absence of willful suppression. iii) The penalties under Sections 76 and 77 were upheld, but the penalty under Section 78 was set aside.
Appeal allowed in part.
-
2025 (2) TMI 799
Short payment of service tax - amount received for construction of roads - Manpower Supply Service (on reverse charge basis) - Extended period of limitation.
Whether the demand of service tax amounting to Rs.33,04,058/- on the amount received for construction of roads is valid under the applicable service tax exemption provisions? - HELD THAT:- There are several entries wherein amounts have been received towards construction of road. These funds have been received either from DRDA, Gorakhpur or Gorakhpur Development Authority, out of MP/MLA funds. It is found that entry 13(a) of Notification No.25/2012 dated 20.06.2012 grants exemption from payment of service tax on construction of road, bridge, tunnels or terminals for road transportation for use by general public. The said amount of Rs.2.20 crore having been received towards construction of road was exempted from payment of service tax. Therefore, the demand of Rs.33,04,058/- is liable to be set aside.
Demand of service tax on availing Legal and Manpower Supply service - Extended period of limitation - HELD THAT:- A similar matter of limitation had come up for consideration before the Division Bench of this Tribunal in the case of G. D. Goenka Pvt. Ltd. [2023 (8) TMI 995 - CESTAT NEW DELHI]. In the said case, the demand had been raised consequent to audit. The extended period of limitation was invoked on the ground that under self assessment, the Appellant assessee was required to assess its own tax due on the services provided by it and file returns under Section 70. By claiming the wrong Cenvat credit, the Appellant willfully and deliberately suppressed the facts from the Department.
The Division Bench referred to the decision of the Hon’ble Supreme Court in the case of Pushpam Pharmaceuticals Company Vs. CCE, Mumbai [1995 (3) TMI 100 - SUPREME COURT] and made detailed observation for holding that extended period of limitation could not have been invoked.
Thus, the Appellant’s case on limitation is squarely covered by aforesaid order of the Division Bench of the Tribunal. Respectfully following the aforesaid order, it is held that the demand of service tax (Rs.33,04,058/- as well as Rs.8,259/-) could not have been raised by invoking of extended period of limitation. As the demands itself are being set aside, penalties under Section 78(1) as well as Section 77(2) are also liable to be set aside.
Conclusion - i) Exemption under Notification No.25/2012 is applicable to road construction projects funded by government bodies, negating the service tax demand. ii) Regular filing of service tax returns precludes the invocation of the extended period of limitation absent evidence of willful suppression. iii) Penalties cannot be imposed when the underlying tax demand is invalidated.
Appeal allowed.
-
2025 (2) TMI 745
Exemption from service tax - services rendered to a Governmental authority - providing services of work contract services - providing services of laying of cable under or along side the road under the National Optical Fibre Undertaking (NOFN) Project - HELD THAT:- The Customs, Excise & Service Tax Appellate Tribunal, New Delhi took the view that the appellant is not entitled to seek exemption under the Notification which it sought to rely upon.
This is a fit case to remand the matter to the original authority only for the purpose of recalculation of the demand extending the benefit of cum-tax on the gross amount charged by the appellant.
Issue notice returnable after four weeks.
-
2025 (2) TMI 744
Invocation of Extended period of limitation - no intent to evade payment of service tax - whether there is any error apparent on the face of the record to review the judgment? - it was held by High Court that 'there is no error apparent on the face of the record, and also there are no grounds to review the judgment, therefore the review petition stands disposed of.'
HELD THAT:- The penalties imposed by the Department in the peculiar facts and circumstances of these cases deserve to be waived and are waived, accordingly.
Appeal allowed.
-
2025 (2) TMI 743
Rejection of refund claim of accumulated Cenvat Credit - rejection on the ground that since opening balance in ST-3 return for the period April’2015 to September’2015 was ‘Nil’, hence credit was never availed in returns and consequently there is no question of refund - HELD THAT:- Apparently, the refund claim was filed by the Appellant in terms of Rule 5 of the CENVAT Credit Rules, 2004 and sub-rule (1) of Rule 5 provides that refund of CENVAT credit shall be allowed subject to procedure, safeguards, conditions and limitations as may be specified by the Board by notification in the Official Gazette. A perusal of Rule 5 nowhere indicates that the same provides disclosure of balances of CENVAT credit in ST-3 return as the condition precedent for claiming refund of credit. There is nothing in Rule 5 to assume that if credit was validly availed but not disclosed in ST-3 return, the same would prohibit the refund of credit.
In exercise of powers conferred under Rule 5(1), Notification No.27/2012-CE(N.T.) dated 18.06.2012 has been issued specifying the safeguards, conditions and limitations and also the procedure for filing the refund claim - clause 2(g) has to be read as it is without any addition or subtraction of words and clause 2(g) cannot be interpreted on any presumption or assumption that balance has to be considered as the amount shown as closing balance in ST-3 return. The interpretation to the contrary placed in the impugned order is therefore clearly erroneous and is not flowing from a plain reading of clause 2(g) of the notification - clearly clause 2(g) of the notification has been incorrectly interpreted in the impugned order and rejection of refund claim on this ground is not sustainable.
Both the parties are ad-idem to the fact that no objection has been raised by the Revenue to the revised return for the subsequent period Oct’2015 to March’2106 showing the same opening balance as disclosed by the Appellant in corrigendum for the period April’2015 to Sep’2015 - It is not disputed before me that by the time the Appellant realised the mistake, the time period for revising the return got expired and therefore the Appellant cannot be expected to perform an impossible task. Thus, there are no reasonable reason for not extending the benefit of the corrigendum to the Appellant.
As regards finding in the adjudication order regarding taking credit within a period of one year, it is found that the said finding has been recorded only on the ground that the amount of credit was not disclosed by the Appellant in ST-3 return for the period April’2015 to Sep’2015. The adjudicating authority appears to have misguided himself by taking a view that credit is taken by declaring the amount of credit in ST-3 return. On the contrary, credit is always taken in account books and/or other statutory records. The disclosure of opening/closing balance of credit and utilised amount of credit in ST-3 may be a condition required to be complied by a taxpayer, but the same by itself is not a condition to claim credit.
There is absolutely no finding in the adjudication or appeal order that the invoices in question were issued prior to period of one year. no adverse finding has been recorded by the two authorities and therefore the submission to the contrary made by the Ld. A.R. deserves to be rejected.
Conclusion - i) Substantive benefits cannot be denied on technical grounds, such as non-disclosure in ST-3 returns. ii) Clause 2(g) of Notification No. 27/2012-C.E should be interpreted based on the actual balance, not the disclosed balance in ST-3 returns. iii) The Adjudicating Authority is directed to sanction the refund claim in accordance with the law.
Appeal allowed.
-
2025 (2) TMI 742
Valuation of service tax - inclusion of charges collected by the appellant, apart from service charges, in the gross taxable value for the purpose of service tax under Section 67 of the Finance Act, 1994 - Pure Agent under Rule 5(2) of the Service Tax (Determination of Value) Rules, 2006 - invocation of extended period of limitation - HELD THAT:- The issue is no more res-integra in view of the decision of the Honourable Supreme Court in the case of UOI v Intercontinental Consultants and Technocrats Pvt Ltd, [2018 (3) TMI 357 - SUPREME COURT] which has considered the issue of liability to pay service tax on reimbursable expenses received by the service provider in the course of rendering services for the client, apart from the consideration received for rendering the services on which the client has discharged the liability to pay service tax. The Honourable Supreme Court affirmed the decision of the Delhi High Court in Intercontinental Consultants & Technocrats Pvt Ltd v UOI, [2012 (12) TMI 150 - DELHI HIGH COURT], wherein Rule 5(1) of the Service Tax Valuation Rules, 2006 which provided for inclusion of expenditures or costs incurred by the service provider in the course of providing taxable services, in the value of such taxable services, was stuck down as ultra vires Section 66 and Section 67 of the Act and as travelling beyond the scope of the said sections.
Conclusion - The service tax should be levied only on the actual consideration for the service provided, excluding reimbursable expenses unless legislatively amended.
The impugned order is set aside - appeal allowed.
-
2025 (2) TMI 685
Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - Seeking direction to Petitioner to make the payment as per Form SVLDRS-3 and to issue discharge certificate in Form SVLDRS -4 under sub-section (8) of Section 127 of the scheme - recovery of CENVAT Credit on the ground of wrongful availment of Input Cenvat Credit and wrong utilization for the payment of duties - it was held by High Court that 'The Scheme being prerogative of the Government and since the petitioner had not abided by the terms and conditions of the Scheme -2019, there are no reason to interfere.'
HELD THAT:- No case for interference is made out in exercise of jurisdiction under Article 136 of the Constitution of India. The Special Leave Petition is accordingly dismissed.
-
2025 (2) TMI 684
CENVAT Credit - capital goods or inputs - towers, shelters and accessories used by the appellant for providing business support services are immovable property or not - emergence of immovable structure at intermediate stage (assuming without admitting) is a criterion for denial of Cenvat Credit or not - suppression of facts or not - invocation of extended period of limitation.
HELD THAT:- The Hon’ble Supreme Court in M/s. Bharti Airtel Ltd. Vs. The Commissioner of Central Excise, Pune [2024 (11) TMI 1042 - SUPREME COURT] has held that Mobile Service Providers (MSPs) could avail the benefit of Central Value Added Tax/CENVAT Credit over excise duties paid on items such as mobile towers and prefabricated buildings (PFBs). The Hon’ble Supreme Court has further observed that the towers and PFBs, though themselves are not electrical equipments, are essential for proper functioning of antenna. Thus, tower being essential for rendering of the output service of mobile telephony, these items certainly can be considered to be “inputs” akin to antenna. It is further observed that without the towers and the pre-fabricated buildings (PFBs), there cannot be proper service of mobile telecommunication. Hence, these certainly would come within the definition of “input” under Rule 2 (k)(ii) of CENVAT Rules.
Conclusion - Towers and shelters are not immovable property and qualify as "inputs" and "capital goods" under the Cenvat Credit Rules, 2004.
Appeal allowed.
-
2025 (2) TMI 683
Refund of amount paid twice towards service tax liability for the period April 2017 to June 2017 - time-barred refund claim under Section 11B of the Central Excise Act, 1944, as applied to service tax by Section 83 of the Finance Act, 1994 - HELD THAT:- Plain reading of Section 11B of the Central Excise Act, 1944 make the position very clear that the scope of Section 11B ibid, deals with refund of duty/tax and duty/tax refers to the duty/tax leviable as per the provisions of the Central Excise/ Service Tax statute. If there are certain taxable services provided over a period for which the service tax payable is “X” and when the same has been paid firstly as per law, and secondly by mistake inadvertently, it is obvious that the amount paid in the context of service tax for the second time has no legal basis, either for levy or for payment as service tax, inasmuch as there is no taxable event for which the levy and payment would apply.
The above issue has been dealt with in detail by the Co-ordinate Bench of the Tribunal in the case of Bansal Biscuits P Ltd. [2023 (11) TMI 615 - CESTAT KOLKATA], wherein it was held that the limitation of time prescribed under Section 11B ibid is not applicable.
The issue of payment of duty/tax for second time, has also been examined by the Hon’ble High Court of Gujarat in the case of Swastik Sanitary wares Limited [2012 (11) TMI 149 - GUJARAT HIGH COURT], upon taking into account the judgement of the Hon’ble Supreme Court in Mafatlal Industries and it was held the assessee is eligible for refund of the amount paid for the second time.
Conclusion - i) The limitation prescribed under section 11B of the Excise Act would not be applicable if an amount is paid under a mistaken notion as it was not required to be paid towards any duty/tax. ii) The amount paid in the context of service tax for the second time has no legal basis, either for levy or for payment as service tax, inasmuch as there is no taxable event for which the levy and payment would apply.
The impugned order is set aside - refund allowed - appeal allowed.
-
2025 (2) TMI 682
Refund claim - input services - whether denial of refund of CENVAT credit on the aforesaid disputed services by holding the same as ineligible ‘input service’ in terms of Rule 2(l) of the CENVAT Credit Rules, 2004 is legally sustainable or not? - Invocation of Section 11B of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1994.
HELD THAT:- Plain reading of the definition of ‘input service’ indicate that there are three categories of input services viz., the first category services given under the ‘means’ part; second category, under the ‘inclusion’ part and the third category of services which are given under the ‘exclusion’ part. Therefore, in order to ensure that a particular input service is eligible for availing CENVAT credit, it should be covered either under first or second category and should not be covered under the third category of excluded items.
Hotel & Short term accommodation service - HELD THAT:- The above services are to be considered as eligible for refund as the learned Commissioner (Appeals-II) himself had held so, and that different stand cannot be taken on the admissibility of input services for allowing refund, and that too for the same assessee-appellants again during the same period, in the absence of any substantial changes in the statute.
Event management service - Management Business consultancy service - HELD THAT:- Since these have been used for enhancing the skills of the employees on duty involved in the company’s projects in order to provide desired results in respect of output services, these fall under the category of “means part” as eligible services under the definition of Rule 2(i) ibid. Therefore, the refund of CENVAT benefit on the above services allowed.
Refund of service tax paid on ‘outdoor catering services’/ ‘outdoor services’ and ‘Health Check-up service’ claimed during the period of April, 2015 to December, 2015 - HELD THAT:- The issue is no more res integra in view of the decision of the Larger Bench of the Tribunal in the case of Wipro Ltd. [2018 (4) TMI 149 - CESTAT BANGALORE - LB], wherein it has been held that the definition of 'input service' has been amended w.e.f. 01.04.2011 providing the exclusion clause, wherein the definition of input service under Rule 2(l) ibid, specifically excludes 'outdoor catering services' and ‘health services’. It has been concluded in the said order that the outdoor catering service is not eligible for input service credit post amendment dated 01.04.2011 vide Notification No. 3/2011-CE (NT) dated 01.03.2011 - the appellants are not eligible to refund of CENVAT credit on such input services.
Invocation of Section 11B of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1994 in rejection of refunds after providing sufficient opportunity for the appellants to demonstrate that the availment of CENVAT credit is in compliance with the CENVAT Credit Rules, 2004 - HELD THAT:- In such circumstances, it cannot be said that what is clearly excluded from the scope of eligible ‘input service’ in terms of Rule 2(l) ibid, can be treated as eligible, since the appellants have already taken CENVAT credit on the same, on the sole ground that it was not objected to earlier by the department. Therefore, sufficient compliance of requirement of Rule 14 of Cenvat Credit Rules,2004 has been adhered to in this case.
Conclusion - The services explicitly excluded under Rule 2(l) of the CENVAT Credit Rules, such as Outdoor catering and Health Check-up services, are not eligible for CENVAT credit, stating that "denial of refund of CENVAT credit in respect of 'outdoor catering services'/ 'outdoor services' and 'Health Checkup service' is proper and justified, being not in conformity with the statutory provisions."
Appeal allowed in part.
-
2025 (2) TMI 681
Adjustments of excess Service tax against Service Tax liability - interpretation of the term "month" in terms of Rule 6(4A) of the Service Tax Rules, 1994 - HELD THAT:- Going by the provisions of Rule 6(4A) of the Service Tax Rules, 1994, it appears that such excess amount paid by the Appellant against its Service Tax liability can be adjusted in the succeeding month or quarter but at this juncture it is also required to reproduce section 13 of General Clauses Act 1897, to give meaning to the use of words ‘month or quarter’, as provided in the Service Tax Rules, which is a statutory provision incorporated by the Central Government.
Going by sub-clause 2 of section 13 that is applicable to all Central Government Acts and Regulations, it is crystal clear that words used in singular would also mean its plural and vice-versa and therefore, adjustments of excess Service Tax paid in subsequent months/quarters can be held to be valid otherwise if, after adjustment in a quarter any balance amount would still be available, that was permitted to be adjusted against excess payment, would lapse to the detriment of the assesse. Apart from the statutory provision also, judicial pronouncements even at the Apex Court level are consistent in giving findings that in construing a statutory provisions words in the singular are to include also its plurals.
Conclusion - Such adjustment of service tax made by the Appellant in different months after such excess payment come to its knowledge, is appropriate and in conformity to Rule-6(4A) of the Service Tax Rules.
The impugned order is set aside - appeal allowed.
-
2025 (2) TMI 680
Relevant date for calculation of interest on refund claim - Interest on the refund amount has not been granted from the date of the application for refund - seeking grant of interest for the remaining period from 11.11.2016 to 13.06.2022 - HELD THAT:- Reference made to the earlier two orders of the Commissionerate, Jaipur and Gautam Budh Nagar has interpreted the order of the Tribunal transferring the refund claims to the concerned jurisdictional Commissionerate to mean that the date of filing of the original refund application shall be the date of transfer of refund and, therefore, the interest has to be calculated from the said date. The application for refund has now been considered on being transferred to the Jurisdictional Commissionerate. Accordingly, the appellant has been granted interest on the refund amount from the date of the original filing of the refund claim, after a period of three months.
In view of the above two orders, which seems to have been accepted by the Revenue, it is felt that they have rightly interpreted the order of the Tribunal as referred above. The Revenue cannot pick and choose to grant relief in one case and deny the same in the other case. Once the original date of filing of the application has to be considered, the necessary implication is that the grant of interest shall also relate back to the said date after the expiry of three months.
Reference made to the decision of the Supreme Court in the case of Ranbaxy Laboratories Ltd. Vs. Union of India [2011 (10) TMI 16 - SUPREME COURT], wherein it has been held that 'interest under Section 11BB of the Act becomes payable, if on an expiry of a period of three months from the date of receipt of the application for refund, the amount claimed is still not refunded.'
Conclusion - The appellant is entitled to interest after the expiry of three months from the date of original filing of the refund application i.e. 11.11.2016 till the date of payment of refund amount i.e. on 13.06.2022.
Appeal allowed.
-
2025 (2) TMI 631
Challenge to appeal before the Delhi High Court under Section 35 G of the Central Excise Act, 1944 - CENVAT credit on inputs and input services - exclusion of value of free materials used by the Assessee - HELD THAT:- A perusal of the order dated 8th December, 2016, passed by the Coordinate Bench of this Court would show that the SCN was quashed, but the Department was permitted to proceed in accordance with the decision in Era Infra Engineering Ltd. vs. Union of India [2016 (10) TMI 1248 - DELHI HIGH COURT] and exclude the value of free materials used by the Assessee.
Both the adjudicating authority and the CESTAT were incorrect in holding that the SCN having been quashed, none of the other demands would also be liable to be adjudicated. Clearly, the decision of the Division Bench of this Court is not to the said effect. In fact, it permitted the Department to proceed further strictly in accordance with the judgment and exclude the value of free materials. All the other demands which are raised, accordingly, deserve to be adjudicated on facts and in accordance with law.
Appeal disposed off.
-
2025 (2) TMI 630
Refund claim - rejection on the ground of time limitation - appellant had not submitted the necessary documents as directed within one year - HELD THAT:- It is an admitted fact that appellant had submitted refund claim within due date initially and it was partially allowed by the Adjudication Authority on merit. Aggrieved by the said order appeal was filed before the Commissioner (Appeal) and after considering the appeal, Commissioner (Appeals) had issued directions to produce the document and also remanded the matter to Adjudication Authority for verification of the document. There is no communication made by the Adjudication Authority on remand regarding de-novo adjudication. Appellant had submitted the document before issuing order in de-novo adjudication proceedings as evidence from the communication relied by the appellant. Fact being so, considering it has a second refund application and rejecting the same as time barred is prima facie unsustainable.
As regarding claims on merit, the first appellate authority while considering the Refund claim against Appeal No. ST/20660/2022 has upheld the rejection of refund of Rs. 28,116/- pertains to professional fees claimed under the category telecommunications services and Rs. 39,337/- pertains to transport of passengers and Rs. 9,838/- pertains to sound recording services. Since appellant has not filed any appeal challenging the said order, said finding attained finality. Accordingly appellant is eligible for refund of balance amount only on production of the document.
Conclusion - The rejection of the refund claim as a fresh claim after compliance with the appellate authority's directions to be unsustainable.
Appeal allowed by way of remand.
-
2025 (2) TMI 629
Service tax on amount transferred between the appellant's bank accounts - Service Tax demand on amounts credited to the ledger of various debtors - HELD THAT:- The Show Cause Notice has taken into consideration the entire bank deposit and then subtracted the amount collected and reflected in the appellant’s ledger while raising the demand. However, it is observed that the appellant while referring to paragraph 18 of the impugned order submits that intra-bank transfer amounting to Rs.11,11,34,154/- was required to be deducted whereas by mistake, only Rs.9,45,56,790/- has been deducted. It is found that this fact of wrong deduction of the amount of Rs.9,45,56,790/- has been accepted by the Revenue also in their grounds of appeal. The appellant's contention is Rs.9,45,56,790/- has been wrongly deducted instead of deduction of 11,11,34,154/-.
There is no evidence available on record regarding deduction of Rs.11,11,34,154/-, pertaining to intra-bank transfer, as claimed by the appellant. Thus, the reconciliation of the deduction needs to be reconsidered by the adjudicating authority. Accordingly, for the purpose of re-quantification of the taxable value, the issue needs to be remanded back to the adjudicating authority.
The appellant has also submitted that the Service Tax has been levied on the amount credited to the ledger of various debtors by considering the same as ‘consideration’ received. The submission made by the appellant in this regard is agreed that the Revenue cannot consider all the receipts and payments towards taxable services without identifying a particular category of service under which the said amount would be taxable. In such circumstances, there are merit in the submission of the appellant that the entire duty liability needs to be reverified on the basis of the details/reconciliation submitted by the appellant. The appellant viz. M/s. Indcap Advisors Pvt. Ltd., is directed to submit all the details before the adjudicating authority and co-operate in the reconciliation for arriving at the liability to Service Tax.
Conclusion - The Revenue cannot assume all receipts and payments are taxable without identifying specific taxable services.
The issue is remanded back to the adjudicating authority for the purpose of re-quantification - Appeal are disposed of by way of remand.
-
2025 (2) TMI 628
Valuation of service tax - inclusion of expenses incurred by the appellant, which were reimbursed by the clients - Section 67 of the Finance Act, 1994, read with Rule 5(1) of the Service Tax (Determination of Value) Rules, 2006 - Pure Agent under Rule 5(2) of the Valuation Rules - Extended period of limitation - HELD THAT:- The issue is no more res-integra in view of the decision of the Honourable Supreme Court in the case of UOI v Intercontinental Consultants and Technocrats Pvt Ltd. [2018 (3) TMI 357 - SUPREME COURT] which has considered the issue of liability to pay service tax on reimbursable expenses received by the service provider in the course of rendering services for the client, apart from the consideration received for rendering the services on which the client has discharged the liability to pay service tax. The Honourable Supreme Court affirmed the decision of the Delhi High Court in Intercontinental Consultants & Technocrats Pvt. Ltd. v UOI [2012 (12) TMI 150 - DELHI HIGH COURT], wherein Rule 5(1) of the Service Tax Valuation Rules, 2006 which provided for inclusion of expenditures or costs incurred by the service provider in the course of providing taxable services, in the value of such taxable services, was stuck down as ultra vires Section 66 and Section 67 of the Act and as travelling beyond the scope of the said sections.
Conclusion - The reimbursed expenses are not part of the taxable value for service tax purposes in terms of Sections 66 and 67 of the Finance Act, 1994.
The impugned order is set aside - appeal allowed.
-
2025 (2) TMI 627
Levy of service tax for providing GTA service - period involved is from April 2008 to March 2013 - HELD THAT:- The adjudicating authority has recorded in the impugned OIO that it is the appellant’s stand that they are providing services to companies who are registered under the Companies Act, 1956. It is also seen from the appellants’ replies to the SCNs that it is also their stand that they have clearly stated in their invoices that the service tax liability will be paid by either consignor or consignee and had enclosed sample invoices for the adjudicating authority’s verification along with complete parties list and service amount for reference. While the adjudicating authority acknowledges that the documentary evidences adduced by the appellant have been perused, these contentions of the appellant have not been disputed or contested by the adjudicating authority. From the legal provisions, it is therefore evident that such companies, private or limited would get covered under the specified entities/categories stated in the notifications for the respective periods either as a company or as a body corporate.
The adjudicating authority has erred in confirming the demand of service tax on GTA services made on the appellant for the reason that coastal energy private limited and fossil logistics private limited had not responded to the subsequent letters of DGCEI sent to them on 05-09-2013. It was incorrect on the part of the adjudicating authority to take up cudgels on behalf of the investigating agency DGCEI, who are amply empowered under statute to collect evidence in case they deem it so necessary, by way of issuance of summons under Section 14 of the Central Excise Act, 1944 of which they would be undoubtedly aware of - As regards the finding of the adjudicating authority on lack of details required as per Rule 4B that ought to figure in a consignment note in the invoices issued by the appellant, in the absence of stating what were the details that have been found deficient or absent, it is unable to appreciate the import of such finding, except that the invoices were lacking certain details that ought to have been there in a consignment note, which is a venial breach. In any event indisputably the appellant has been rendering the GTA services for which it is registered.
The adjudicating authority grossly erred in confirming the demand of service tax on GTA services on the appellant on the ground that the appellant has not proved that the service tax has been paid by the recipients. When the position in law as emanating from the discussions above is that the onus of discharging the service tax on GTA services received itself, was on the customers of the appellant, then such a confirmation of demand as has been made in the instant case, cannot be sustained and the demand on GTA services to the extent of the amounts stated as disputed in this appeal by the counsel for the appellant, from the demand confirmed by the adjudicating authority is set aside.
The appellant has produced a chartered accountant’s certificate certifying that the amounts were indeed written off as bad debts and finding no valid objection raised as to the acceptance of the same or any reason to disbelieve the same, such certification by an independent professional lends credence to the appellant’s contentions in this regard and consider it sufficient to drop the demand.
The penalties imposed on the appellant under Section 78 and Section 76 do not sustain. There are no grounds urged in the appeal or any specific contention advanced by the counsel against the demand of Rs.14,200/- for the delay in filing of returns as well as the total penalty of Rs.10000/- under section 77 imposed on the appellant and we are therefore of the view that in the facts and circumstances of this case these need to be left without interference.
HELD THAT:- i) The liability to pay service tax on GTA services can shift from the service provider to the service recipient under specified conditions, and that the service provider is not responsible for ensuring the service recipient fulfills their tax obligations. ii) The demand related to bad debts was dropped, and penalties under Sections 76 and 78 were nullified.
Appeal disposed off.
-
2025 (2) TMI 626
Refund of unutilized CENVAT credit paid on input services used for the services exported - non-submission of relevant documents as prescribed under Notification No.05/2006 CE (NT) dated 14.03.2006 - hit by limitation of time in terms of Section 11B of the Central Excise Act, 1944 read with section 83 of the Finance Act, 1994 - violation of principles of natural justice - HELD THAT:- The original refund claim filed on 31.12.2010 continues to languish 14 years later. It is found that the Original Authority in denovo proceedings at para 5.7 of his order dated 15.05.2020, had as per the appellate directions proceeded to examine as to whether the input services are eligible for availment of CENVAT credit and found that the eligible credit worked out to Rs 18,30,182/- as against Rs 19,39,818/- claimed. He only rejected the same for non-submission of documents which he had not specified or called for and which was against the principles of natural justice. No purpose will be served in sending the matter back and the ends of justice would require that the appellant be allowed to succeed in his appeal to this extent.
The impugned order is set aside and the appeal is allowed for the monetary refund of eligible credit worked out as Rs 18,30,182/- by the Original Authority.
-
2025 (2) TMI 625
Refund of cenvat credit based on the nexus between input services and output services - power of Commissioner (A) to remand the matter to the lower authority - HELD THAT:- On going through the finding given by the adjudicating authority as per Order-in-Original No.249/2009-ST dated 19.06.2009 wherein the entire activities and claim made by the assessee were subject to scrutiny and only thereafter, specific finding was given that these services including the ‘Technical Consultancy Service’ and ‘Manpower Recruitment and Supply Agency Services’ are having direct nexus with the output services and sanctioned refund of cenvat credit. Further, the assessee is a 100% Export Oriented Unit (EOU) and the inputs used for such services are having direct nexus with the output services. Fact being so, the assessee had made proper claim for cenvat credit and eligible to claim refund of Rs.82,13,666/- as sanctioned by original authority vide Order-in-Original No.249/2009-ST dated 19.06.2009.
Conclusion - The assessee was eligible to claim the refund of cenvat credit as sanctioned by the original authority.
Revenue dismissed.
-
2025 (2) TMI 615
Levy of service tax - various charges and receipts by a Customs House Agent (CHA) - taxability of reimbursable expenses - categorization of certain receipts under Business Auxiliary Services - invocation of extended period of limitation.
Taxability of reimbursable expenses - HELD THAT:- The issue is no more res-integra in view of the decision of the Honourable Supreme Court in the case of UOI v Intercontinental Consultants and Technocrats Pvt Ltd, [2018 (3) TMI 357 - SUPREME COURT] which has considered the issue of liability to pay service tax on reimbursable expenses received by the service provider in the course of rendering services for the client, apart from the consideration received for rendering the services on which the client has discharged the liability to pay service tax. The Honourable Supreme Court affirmed the decision of the Delhi High Court in Intercontinental Consultants & Technocrats Pvt Ltd v UOI, [2012 (12) TMI 150 - DELHI HIGH COURT], wherein Rule 5(1) of the Service Tax Valuation Rules, 2006 which provided for inclusion of expenditures or costs incurred by the service provider in the course of providing taxable services, in the value of such taxable services, was struck down as ultra vires Section 66 and Section 67 of the Act and as travelling beyond the scope of the said sections - the findings and confirmation of demand under the nomenclature reimbursable expenses as made in the impugned order in original cannot sustain.
Levy of service tax with respect to freight/rebate/brokerage/operational surplus as CHA service - HELD THAT:- The learned adjudicating authority has rendered a specific finding in the OIO that rebate and brokerage amount received by the appellants are not liable under CHA service. However, that does not translate into a sanction for the learned adjudicating authority to unilaterally confirm the demand on these services under business auxiliary service for the aforementioned period, without putting the appellants to notice about the adjudicating authority’s said intention to do so - in any event, the finding of the adjudicating authority that rebate and brokerage received by the appellants are liable to be taxed under Business Auxiliary Service for the period 2006-07, 2007-08 and 2008-09, and the consequent confirmation of demand, is liable to be set aside as such a finding travel beyond the proposals in the SCN.
Extended period of limitation - penalties - HELD THAT:- The ingredients to invoke the extended period was absent. There is no evidence let in of any positive act of suppression or wilful misstatement with intent to evade payment of service tax on the part of the appellant, and thus the ingredients required to invoke extended period of limitation has not been established by the Department. There are force in the contentions of the learned counsel for the appellant that the issues involved were of interpretational nature and therefore the allegation of malafides made to invoke the extended period of limitation and impose penalties are untenable.
Conclusion - i) The reimbursable expenses are not part of the taxable value. ii) The profits from the sale and purchase of cargo space are not taxable under Business Auxiliary Services, as these are principal-to-principal transactions. iii) There are no grounds for invoking the extended period of limitation, as the Department failed to establish any fraudulent intent or suppression of facts by the appellant.
The impugned order in original is set aside and the appeal is allowed.
............
|
9911796707
