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Service Tax - Case Laws
Showing 261 to 280 of 30972 Records
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2025 (2) TMI 215
Valid service of SCN and the Order-in-Original issued u/s 73 of the Finance Act, 1994 - jurisdiction to issue the Order-in-Original based on the information available in Form 26AS under the Income Tax Act, 1961 - liability to pay service tax on export services under the provisions of the Finance Act, 1994 - HELD THAT:- The decision or order passed or any summons or notice issued under the Act is to be served by various modes as prescribed in clause (a) by tendering or by registered post or by speed post with proof of delivery or by courier, failing which, by affixing a copy thereof to some conspicuous part of the factory or warehouse or other place of business or usual place of residence of the person for whom such decision, order, summons or notice, as the case maybe, is intended and on failure of the modes prescribed in clauses (a) and (b), by affixing a copy thereof on the notice board of the Officer who passed such decision or order or issued summons or notice.
Admittedly the show-cause notice was never served upon the petitioner. Similarly, the letter dated 07.04.2022 fixing the personal hearing as well as the Order-in-Original were also sent by speed post as contended in the reply dated 30th May, 2023 given under the RTI Act, however, the same also met with the same fate of not delivering upon the petitioner. Therefore, the respondent-Authority was required to take recourse to clauses (b) and (c) of Sub-section (1) of Section 37C of the Act, 1944, however, it is admitted in the affidavit-in-reply that as the petitioner had changed the place of the business, it was not possible to follow the provisions of Section 37C (b) of the Act, 1944 as at the time of delivery, the address of the premises was not in existence but the provisions of Section 37C (c) was followed by affixing copy thereof on the notice board, no document or details are available even for compliance of clause (c) of Section 37C (1) of the Act, 1944.
It is clear that neither the show-cause notice nor the Order-in-Original was ever been served upon the petitioner at any point to time and when there is non service of the show-cause notice and the Order-in-Original, both are liable to be quashed and set aside.
Conclusion - i) The show-cause notice and the Order-in-Original were invalid due to improper service, as per Section 37C of the Central Excise Act, 1944. ii) The petitioner was not liable to pay service tax on export services under Section 66B of the Finance Act, 1994. iii) The respondent authority lacked jurisdiction to issue the Order-in-Original based on improperly served notices and incorrect application of tax liability principles.
The matter is required to be considered in favour of the petitioner as petitioner was never liable to pay the service tax on the export services under the provisions of the Act, 1994 and hence, no further orders are required to be passed - petition allowed by way of remand.
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2025 (2) TMI 214
CENVAT Credit - inputs/input services used in relation to output service - angles, channels, beams, etc., which are used for erecting transmission towers - HELD THAT:- While considering the issue as to whether the appellants were eligible for the cenvat credit availed on angles, channels, beams, etc., which are used in providing output, the Hon’ble Supreme Court in the case of Bharti Airtel Ltd. [2024 (11) TMI 1042 - SUPREME COURT] observed that 'the tower and pre-fabricated buildings (PFBs) are “goods” and not immovable property and since these goods are used for providing mobile telecommunication services, the inescapable conclusion is that they would also qualify as “inputs” under Rule 2(k) for the purpose of credit benefits under the CENVAT Rules.'
Conclusion - The structures essential for service provision, even if not directly involved in the service, qualify as inputs. CENVAT Credit allowed.
Appeal allowed.
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2025 (2) TMI 213
Abatement of appeal - continuation of appeal proceedings, following the death of the appellant, who was a sole proprietor - Rule 22 of the Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982 - HELD THAT:- The Appellant who was a sole proprietor has died on 16.08.2021 during the pendency of the present appeals. It is also found that in terms of Rule 22 of Customs, Excise and Service Tax Appellate Tribunal (Procedure) Rules, 1982, on the death of the appellant, the proceedings will be abated unless an application is made for continuance of such proceedings by the legal Heirs of the Appellant. In this case, no such application has been received. As the Death has occurred on 16.08.2021, nearly four years passed already.
In view of the judgement of the Hon’ble Supreme Court in the case of SHABINA ABRAHAM AND OTHERS VERSUS COLLECTOR OF CENTRAL EXCISE & CUSTOMS [2015 (7) TMI 1036 - SUPREME COURT], wherein it has been held that no proceedings can be initiated or continued against a dead person as it amounts to violation of natural justice in as much as the dead person, who is proceeded against is not alive to defend himself.
Conclusion - On the death of the appellant, the appeals stand abated and disposed of in terms of Rule 22 of the CESTAT procedure Rules, 1982.
Appeal disposed off.
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2025 (2) TMI 212
Classification of services - supply of tangible goods services or cargo handing services? - first agreement of performing the work of terminal handling of containers at Inland Container Depot, Tughlakabad, New Delhi - second agreement of cargo handling operation in relation to export and import cargo - extended period of limitation.
First Agreement - Terminal Handling - whether the appellant had provided “supply of tangible goods” services or “cargo handing” services to CONCOR? - HELD THAT:- The agreement, it is seen, is for performing the work of handling of containers at ICD, Tughlakabad at the rates and conditions specified in the Schedule annexed to the agreement. The rate Schedule clearly shows that an amount of Rs. 8 lakhs is to be paid to the appellant towards hiring of each of the two loaded reach stackers for round the clock operation, and Rs. 4.50 lakhs for hiring of one empty reach stacker for round the clock operation. It is, therefore, clear that CONCOR hired two loaded reach stackers and one empty reach stacker, for which the appellant was to receive consideration in terms of money. The rate schedule does not refer to handling of cargo at all and indeed could not have, as the agreement is for providing reach stackers to CONCOR - The terms of the agreement clearly show that the appellant rendered “supply of tangible goods” service to CONCOR.
Second Agreement - Cargo Handling - whether the appellant was justified in not paying service tax for handling operations in respect of export cargo? - HELD THAT:- The amount received by the appellant for handling of import cargo as also export cargo. This apart, as can be seen from the second agreement also the charges to be paid to the appellant for handling of import cargo and export cargo are different - The Court remanded the issue of service tax liability for export cargo handling under the second agreement to the adjudicating authority for fresh consideration, allowing the appellant to submit additional evidence.
Extended period of limitation - HELD THAT:- It is, therefore, a fit case where the matter needs to be remanded to the adjudicating authority to examine the levy of service tax on handling of export cargo afresh after providing an opportunity to the appellant to substantiate what was contended by the appellant in reply to the show cause notice, namely that it had handled export cargo also. The appellant may provides such evidence to the adjudicating authority within a period of six weeks from today. The adjudicating authority shall examine the evidence, if submitted. The appellant may also substantiate its submission that the extended period of limitation could not have been invoked in so far as this service is concerned.
Conclusion - i) The appellant provided "supply of tangible goods" services under the first agreement, not "cargo handling" services. ii) The Court remanded the issue of service tax liability for export cargo handling under the second agreement to the adjudicating authority for fresh consideration, allowing the appellant to submit additional evidence. iii) It is, therefore, a fit case where the matter needs to be remanded to the adjudicating authority to examine the levy of service tax on handling of export cargo afresh after providing an opportunity to the appellant to substantiate what was contended by the appellant in reply to the show cause notice, namely that it had handled export cargo also.
Appeal allowed in part by way of remand.
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2025 (2) TMI 211
Taxability of the value of “premium” or “salami” for the period prior to 01.07.2012 and w.e.f. 01.07.2012 under ‘renting of immovable property’ - Whether ‘premium’ or ‘salami’ can be subjected to levy of service tax under ‘renting of immovable property’ defined under section 65(90a) of the Finance Act? - HELD THAT:- “Premium” is a payment for being allowed to take possession of the immovable property. It is a price paid for a transfer of a right to enjoy the property. The lessor, who owns and possesses the property transfers the possession to another for a price. There can, therefore, be no doubts that ‘premium’ is the amount received for “renting” of immovable property.
Section 65B (44) of the Finance Act defines “service” to mean any activity carried out by a person for another for consideration, and includes a “declared service”. It is seen that consideration is received in the form of premium which would be included in the definition of “renting”. “Renting of immovable property” is a “declared service” under section 66E of the Finance Act. Once “renting of immovable property” is a declared service and so taxable under section 66B of the Finance Act, it cannot be contended by the appellant that it will also be included in those services which are excluded under section 65B (44) of the Finance Act, for it can never be the intention of the legislature to include a “service” as exigible to service tax and at the same time also exclude that “service” from taxability. The contention of the appellant that it is excluded from taxability under sub-clause (a)(i) of section 65B(44) of the Finance Act cannot also be accepted for this reason.
Conclusion - The value of “premium” or “salami” is exigible to service tax under “renting of immovable property” for the period prior to 01.07.2012 under section 65(105)(zzzz) of the Finance Act and from 01.07.2012 under section 66B of the Finance Act.
The two appeals may now be placed before the respective Division Benches of the Tribunal for deciding them on merits.
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2025 (2) TMI 182
Recovery of service tax with interest and penalty - amounts recorded as license fees, documentation fees, and computer software expenses in the appellant's books of account - applicability of service tax on transactions involving the transfer of technology and related documentation from foreign vendors to the appellant - Extended period of limitation - HELD THAT:- The issue is no more res integra and this Bench of the Tribunal in Appellant’s own case being Service Tax Appeal No.70058 of 2019 having Final Order No.70784 of 2024 dated 02.12.2024 [2024 (12) TMI 281 - CESTAT ALLAHABAD] has decided the dispute in favour of the Appellant-Assessee.
Extended period of limitation - HELD THAT:- The invocation of the extended period of limitation was deemed inapplicable.
Conclusion - i) The demand for service tax based on accounting entries was set aside. ii) The classification of transactions as "Intellectual Property Services" was rejected. iii) The invocation of the extended period of limitation was deemed inapplicable.
Appeal allowed.
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2025 (2) TMI 143
Exemption from service tax under N/N. 25/2012-ST dated 20.06.2012 - services provided by M/s. Shree Hindustan Fabricators to Surat Municipal Corporation (SMC) with regard to water supply - HELD THAT:- The matter is no longer res-integra as this Tribunal in case of C.C.E. & S.T. -SURAT-I VERSUS SHREE HINDUSTAN FABRICATOR [2024 (12) TMI 1240 - CESTAT AHMEDABAD] (the appellant themselves), has decided the issue in the favour of the respondent/assessee.
It was held in the said case that 'We are therefore of the view that provisions of the Notification No. 25/2012-ST dated 20.06.2012 under serial no. 12E and Serial No. 25A are fully applicable applicable towards activity undertaken by the respondent assessee and therefore fall under the category of the exempted services.'
Conclusion - The exemption for services provided to SMC under Notification No. 25/2012-ST upheld, emphasizing the non-commercial nature of the services.
Appeal dismissed.
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2025 (2) TMI 106
Review petition - no error apparent on the record - Extended period of limitation - Suppression of facts or not - Levy of Service Tax - health and fitness service - providing education to patients regarding Yoga - donation received in respect of yoga camp / residential Yoga camp - HELD THAT:- There is no error apparent on the record.
Review Petition is dismissed.
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2025 (2) TMI 105
Challenge to recovery notice - eligibility for the benefits under the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 - mis-declaration regarding the pendency of an appeal - misdeclaration regarding date of filing of the appeal - HELD THAT:- Since the declaration in Form SVLDRS-1 dated 31.12.2019 that was filed by the petitioner was not under the “voluntary disclosure category”, the rigours of clause (c) to sub-section (2) to section 129 (1) of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 in Chapter V of the Finance Act, 2019 cannot be pressed against the petitioner - The petitioner ought to have filed a correct declaration under “Amount in Arrears category” as defined in Section 121(c) of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 in Chapter V of the Finance Act, 2019 as no appeal was pending on 30.06.2019.
Since the declaration in Form SVLDRS-1 dated 31.12.2019 filed by the petitioner under the “litigation category” [i.e., pendency of appeal] was incorrectly filed and should have been filed under “Amount in Arrears Category”, the amount that was payable by the petitioner would have higher.
Since the petitioner was otherwise entitled to relief under Section 124(1)(ii) of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 in Chapter V of the Finance Act, 2019, the benefit of the Scheme cannot be denied, provided the petitioner pays the correct amount - the Impugned Communication dated 30.03.2021 cannot be said to be strictly in consonance with Section 129(2)(c) of the Sabka Vishwas (Legacy Dispute Resolution) Scheme, 2019 in Chapter V of the Finance Act, 2019 in revoking the Discharge Certificate in Form SVLDRS-4 dated 07.03.2020. Nevertheless, powers are vested with the Designated Authority under the said Act to correct the mistake in the Discharge Certificate in Form SVLDRS-4, if the Designated Authority was mislead and an improper declaration is filed by a declarant. If the petitioner wants the benefit of the Scheme, the petitioner should pay the correct amount together with interest.
Since there is no enabling machinery under the provisions of the Finance Act, 1994 which enables the Department to recover the tax due from the Directors of the Company which is in arrears of tax, recovery / attachment of Bank Accounts of the Directors of the defaulting Company namely M/s.Laundry Projects India Private Limited, the Impugned Communication dated 23.11.2021 seeking to attach the Bank Accounts of the individual Directors purportedly in exercise of powers conferred under Section 87 of the Finance Act, 1994 has to be held to be without jurisdiction - It also appears that a sum of Rs. 22,00,000/- has been recovered from the account of the petitioner in W.P.No.4329 of 2022, who is the Director of the said Company on 10.01.2022. This amount can be adjusted against the aforesaid deficit amount of Rs. 29,94,472.20/- [Rs.45,65,834.20/- - Rs. 15,71,362/-] subject to the petitioner in W.P.No.4329 of 2022 consenting to the same.
Conclusion - i) Since there is no provision to recover the dues of the writ petitioner in W.P.No.27248 of 2021 M/s.Laundry Projects India Private Limited (from the Directors of M/s.Laundry Projects India Private Limited) under the Scheme of the provisions of the Finance Act, 1994, the Communication dated 23.11.2021 impugned in W.P.No.4329 of 2022 shall stands quashed with consequential relief. ii) The petitioner was entitled to relief under Section 124(1)(c)(ii) and not under Section 124(1)(a)(ii) due to the absence of a pending appeal as of June 30, 2019.
Petition disposed off.
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2025 (2) TMI 104
Levy of service tax on construction activities completed before the imposition of service tax on 01.07.2010 - non-payment of service tax on provision of taxable services of construction of residential complex - HELD THAT:- On perusal of the legal provisions of sub-sections (30a), (91a) of Section 65 of the Finance Act, 1994 and clause (zzzh) of Section 65(105) ibid, which provide for definition of various terms and itemized the scope of the entry of taxable service, respectively, it seen that any service provided in relation to construction of a complex which is intended for sale, wholly or partly, by a builder was subject to levy of service tax w.e.f. 01.07.2010. Exception made from such levy relate to those cases, where no sum or amount was received from any buyer before grant of completion certificate by the authority competent to issue it under the law. Construction of residential complexes having more than twelve residential houses or apartments together with common areas and other appurtenances were subjected to levy of service tax in the Union Budget for the year 2005. Further, in the definition of the taxable services of ‘Construction of Complex service’ itself an explanation was provided that unless the entire consideration for the property is paid after the completion of construction (i.e. after issuance of completion certificate by the competent authority), the activity of construction would be deemed to be a taxable service provided by the builder/promoter/developer to the prospective buyer and the service tax would be charged accordingly.
The certificate issued by MCGM on completion of building under the Mumbai Municipal Corporation Act is not only termed as occupancy certificate but also completion certificate with title "FULL OCCUPANCY CERTIFICATE Under Regulation 6(7) and BUILDING COMPLETION CERTIFICATE Under Regulation 6(6)". However, the appellants have not provided any such certificate issued by the competent authority i.e., MCGM.
There is no ‘Full Occupancy Certificate’ or ‘Building Completion Certificate’ issued by MCGM under Section 353A of the Mumbai Municipal Corporation Act, 1888. Therefore, it cannot be reasonably concluded that the construction of the residential complex in the present case was completed before 01.07.2010, in the absence of requisite ‘Completion Certificate’ issued by MCGM to substantiate the same. The appellants have selectively relied upon word "is completed" in the certificate issued by the Chief Fire Officer, Mumbai Fire Brigade and Brihan Mumbai Mahanagar Palika to emphasize that the building has been completed on or before 25.01.2010, but has conveniently ignored the word "part development work of building" used while initiating the sentence which is clearly indicative that it is only a part and not the whole building which is completed. Further, in any case, the fact of the case clearly indicate that no ‘occupancy certificate’ has been issued by the competent authority (MCGM) authorized by law (Mumbai Municipal Corporation Act, 1888) as is clearly required under the provisions of Finance Act, 1994.
Further, the advance/sum of money received towards sale of flats/shops, even though was shown to have been accounted during the year 2020- 2021 in the appellants books of accounts, to the extent that such sum was relatable to the flats/shops for whose ‘completion certificate’ was issued subsequent to the levy of service tax and is not covered by the exclusion part of the explanation to Section 65(105)(zzzh) ibid.
Conclusion - The letter dated 25.01.2010 does not qualify as a completion certificate for service tax purposes, and the appellants' failure to maintain separate accounts for deposits as required by the Maharashtra Ownership Flats Act resulted in service tax liability on such deposits. The appellant is liable to pay service tax.
The impugned order dated 29.03.2019 is upheld and the appeal filed by the appellants is dismissed.
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2025 (2) TMI 103
Refund of the service tax paid - appellants contended that the developer had collected the service tax wrongly and they paid the tax by mistake of law - applicability of time limitation u/s 11B of the Central Excise 1944 as made applicable to service tax matters by virtue of Section 83 of the Finance Act, 1994 - Board Circular No. 108/02/2009-ST dated 29.01.2009 - insertion of explanation to Section 65(105)(zza) of the Finance Act, 1994 with effect from 01.07.2010 - HELD THAT:- There is catena of decisions wherein it is held that service tax on 'construction of complex' service is not leviable for the period prior to 01.07.2010. It is also found that the service tax paid by the individual flat purchasers is during the period September 2008 to May 2010. Hence, the service tax on 'construction of complex' is not leviable during that period.
Further, it is found that the Hon'ble High Court of Karnataka in the case of COMMISSIONER OF CENTRAL EXCISE (APPEALS), BANGALORE VERSUS KVR CONSTRUCTION [2012 (7) TMI 22 - KARNATAKA HIGH COURT] held that 'When once there was no compulsion or duty cast to pay this service tax, the amount of Rs. 1,23,96,948/- paid by petitioner under mistaken notion, would not be a duty or "service tax" payable in law. Therefore, once it is not payable in law there was no authority for the department to retain such amount. By any stretch of imagination, it will not amount to duty of excise to attract Section 11B. Therefore, it is outside the purview of Section 11B of the Act.'
It is found that against the order of the Hon'ble High Court of Karnataka the SLP filed by the Revenue was dismissed by the Hon'ble Supreme Court reported in COMMISSIONER VERSUS KVR CONSTRUCTION [2011 (7) TMI 1334 - SC ORDER].
Conclusion - The rejection of the refund claims by the Adjudicating authority/Appellate authority on the grounds of limitation under section 11B of the Central Excise 1944 as made applicable to service tax matters by virtue of Section 83 of the Finance Act, 1994 is not tenable and are liable to be set aside.
Appeal allowed.
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2025 (2) TMI 102
Denial of Cenvat credit - service tax paid for 'Mandap Keeper Services' in relation to their Annual Day celebrations - 'Mediclaim and personal accident policy' premium paid to the employees.
Mediclaim and personal accident policy premium paid to the employees - HELD THAT:- In view the decision of the Larger Bench in M/S. TATA TELESERVICES (MAHARASHTRA) LIMITED VERSUS COMMISSIONER, SERVICE TAX, MUMBAI-II. [2024 (3) TMI 1407 - CESTAT MUMBAI [LB]], the insurance premium paid by the appellant in respect of the insurance policies taken for the employees and their family members can be considered as activity relating to business, for the period prior to 01.04.2011. Since the period involved in both the appeals is prior to 01.04.2011, it is found that the decision of the larger bench is squarely applicable to this case, hence the appeals are sustainable and need to be upheld.
Mandap Keeper Services - HELD THAT:- Following the decision in M/s. Endurance Technologies Pvt Ltd. Vs. C.CEx., Aurangabad [2013 (8) TMI 601 - CESTAT MUMBAI], it is found that the appeals are sustainable.
Conclusion - The services in question indeed qualified as 'input services' under the pre-01.04.2011 definition. The definition of 'input service' prior to 01.04.2011 includes services related to employee welfare and business events, thereby Cenvat credit for such expenses allowed.
Appeal allowed.
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2025 (2) TMI 75
Levy of service tax - service received from AFL and other foreign bank - service provided to an account holder or not - applicability of Rule 3 of the Place of Provision of Services Rules, 2012 - reverse charge mechanism.
Whether the appellant has received payment processing services from AFL engaged by M/s. C&A Buying, Germany-the foreign buyer to process payments to the appellant and if so, whether the demand of Service tax under Reverse Charge Mechanism is sustainable? - HELD THAT:- The identical issues as involved in the present case, were also involved in the case of M/S. AKR TEXTILE AND OTHERS VERSUS COMMISSIONER OF CENTRAL EXCISE & SERVICE TAX COIMBATORE [2020 (10) TMI 479 - CESTAT CHENNAI] wherein Chennai Tribunal has allowed 22 appeals of the exporters by setting aside the impugned orders. It is pertinent to reproduce the relevant findings of the Tribunal where it was held that 'If at all, the Hong Kong entity is an “intermediary‟ within the meaning assigned in Place of Provision of Service Rules, 2012 to render the service, it has been performed in Hong Kong and, thus, not in the taxable territory. The demand for the period after 1st July 2012 also fails. Consequently, the liability for allegedly having received services provided by M/s Amsco Finance Ltd also does not sustain.'
The service of remittance by a foreign bank to Indian bank of the exporter is not liable to service tax at the hands of the exporter. In this regard, reference is drawn to the decision of Chennai Bench of the Tribunal in the case of M/S. SKM EGG PRODUCTS EXPORT (I) LTD. VERSUS THE COMMISSIONER OF CENTRAL EXCISE (APPEALS) , ANNAI MEDU SALEM. [2023 (3) TMI 1384 - CESTAT CHENNAI] wherein the Tribunal after relying upon the decision of M/S DILEEP INDUSTRIES PVT. LTD. VERSUS CCE, JAIPUR [2017 (10) TMI 1231 - CESTAT NEW DELHI] has observed 'it appears that while exporting their goods, they lodged their bills for collection to the Indian Bankers who in turn send the same to the foreign banks. The foreign banks while remitting the money to the Indian Bank, deduct their charges for collection of bills which in turn are charged by the Indian Banks from the appellants. When it is so, then the appellant are not entitled to pay the service tax.
Conclusion - For a service tax liability to arise under the Reverse Charge Mechanism, there must be a direct service provider and service recipient relationship. The deduction of charges by foreign entities as part of a trade arrangement does not constitute a taxable service to the appellant. The appellant was not liable for service tax on the services allegedly received from AFL and foreign banks.
Appeal allowed.
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2025 (2) TMI 13
Failure to pay service tax for certain courses conducted by them on payment for certain assessment years - whether the Joint Commissioner had the jurisdiction to pass the final order without issuing a fresh show cause notice after the case was transferred from the Commissioner of Central Excise? - HELD THAT:- On perusal of the show cause notice, we find that the show cause notice was issued by the Commissioner while the final order was passed by the Joint Commissioner. On that ground, the impugned order was set aside and the matter was remitted back to the Joint Commissioner for fresh consideration. On perusal of the original impugned order passed by the Joint Commissioner, it is found that the very same point was agitated by the respondent herein (writ petitioner) and in the original impugned demand order was confirmed under Section 73(2) of the Finance Act, 1994 and appropriate interest was levied under Sections 75, 78, 77(1)(c) and 77(2) of the Finance Act, 1994. As against that order, the appeal lies to the Commissioner of Central Excise (Appeals), Coimbatore at Madurai.
When a show cause notice has been issued by the higher officer and after entering the appearance and after commencing the enquiry, in the middle of the enquiry, the matter has been made over to the lower officer, who had passed an order, here in this case, the Joint Commissioner. As against that order, appeal lies to the Commissioner of Central Excise (Appeals), Coimbatore at Madurai. As submitted by the learned Senior Standing Counsel, that the officer is also below the rank of the officer had issued the show cause notice, which is impermissible both under the administrative law as well as under the Finance Act.
Conclusion - Since the impugned order was set aside only on the technicalities, it is not proposed to delving into details as to whether the alleged service is said to have been rendered by the respondent to attract the GST or not, which is left open to be decided by the competent authority and hence, there is no positive reason to interfere with the order passed by the learned Single Judge.
Appeal dismissed.
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2025 (2) TMI 12
Levy of service tax on the entirety of income as consideration for having rendered ‘management, maintenance or repair service’ under the authority of section 65(105)(zzg) of Finance Act, 1994 and as consideration for ‘service’ as defined in section 65B(64) of Finance Act, 1994 for the respective periods - exclusion of amount received as ‘sub-contractor’ - HELD THAT:- It is noticed that partial disaggregation resorted to for taxing of ‘works contract service’ and ‘security services’, while excluding taxability for non-conformity of some with definition in section 65(64) of Finance Act, 1994, is tantamount to adoption of inconsistent ascertainment of leviability. There is no doubt that the provisioning of roads, facilities and infrastructure for residents of designated areas devolves statutorily upon ‘local authorities’ as defined in the Constitution and the respective statutes. These are not commercial ventures of the local authority and, consequently, should be covered in the exemptions or exclusions that are available to such authorities under law.
As pointed out by the Learned Counsel for the appellant, the decisions of the Hon'ble Supreme Court, in COLLECTOR OF C. EX., VADODARA VERSUS DHIREN CHEMICAL INDUSTRIES [2001 (12) TMI 3 - SUPREME COURT] and in COMMISSIONER OF CENTRAL EXCISE, BOLPUR VERSUS M/S RATAN MELTING & WIRE INDUSTRIES [2008 (10) TMI 5 - SUPREME COURT], bind subordinate officers to the confines of circulars of Central Board of Excise & Customs (CBEC) and the contextual reference to these in the submissions of the appellant-assessee have not been considered by the adjudicating authority.
The appellant-Commissioner, while not touching upon the exclusion of ‘multi-functional belts’, has assailed inclusion of consideration received from the principal contractor by reference to entries in the books of accounts.
Conclusion - The tax liability would have to be adjudged strictly in conformity with the proposal for taxing the consideration as ‘management, maintenance or repair service’ for the period prior to July 2012 and, to the extent that the impugned order has not, the matter requires a fresh appraisal.
The matter remanded back to the adjudicating authority for a fresh decision strictly on conformity of the proposals made in the show cause notice with the provisions of law as existed prior to 1st July 2012 and for the period thereafter - appeal allowed by way of remand.
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2025 (2) TMI 11
Refund of payment made on advance receipt prior to 30.06.2017 under Finance Act, 1994 - tax paid twice - rejection of refund on the ground that tax was appropriately paid under the provisions of Finance Act, 1994 as it then existed - HELD THAT:- After considering the merits of the matter and concluding that the double taxation was avoidable even under the two tax regimes the matter was remitted by the Learned Single Member Bench, in that case, due to the natural justice not having been followed. This court finds that the observations made on the aspect of double taxation under two different tax regime are relevant and deserves to be followed.
Due to the special features available in GST Regime, the Learned Member of Single Member Bench of Chennai in M/S. THIRUMAL FAÇADE SOLUTIONS VERSUS COMMISSIONER OF GST & CENTRAL EXCISE, CHENNAI [2023 (2) TMI 1252 - CESTAT CHENNAI] has correctly held that there cannot be a double taxation. It is for department to choose whether it would like to refund tax or give credit under GST regume. Since in this case tax on the same transaction has been suffered twice, therefore, as per the provision of Finance Act, 1994 including provisions of refund as have been borrowed from Central Excise Act, 1944, the refund is permissible and deserves to be allowed.
Conclusion - The appellant is entitled to a refund of the service tax paid under the Finance Act, 1994, due to the subsequent taxation of the same transaction under the GST regime.
Appeal allowed.
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2025 (2) TMI 10
Classification of services - intermediary services or not - after sales services and promotion of goods - period involved is from July 2012 to September 2014 - extended period of limitation - HELD THAT:- In view of statutory provision the services having been provided in India to the customer of Koch Membrane, USA through the intermediary which in this case was the appellant, same as discussed by the Commissioner in order, cited above, cannot be treated as “Export of Services‟. Secondly, this court is also not impressed by the argument advanced by the appellants that they having provided technical services and technical promotional quality design installation, commissioning and testing services to clients of Koch Membrane Systems, USA in India, such services were not covered as intermediary services prior to amendment of 2014 in Section 2(f) as they prior to the period of Notification 14/2014 dated 01.10.2014 were only dealing with the goods and prior to amendment vide above notification for the impugned period i.e. July 2012 to September 2014 they were not providing service in relation to services but only in relation to the goods.
The appellants were facilitating and arranging for the services between the buyers of Koch Membrane, and Koch Membrane Systems, USA who was otherwise required to provide such services in India. Such services were very much within the ambit of Notification No. 28/2012-ST dated 20.06.2012 even prior to the amendment carried out by Notification No. 14/2014-ST dated 11.07.2014 which only widened the scope to include even those intermediaries which arrange for supply of goods between two or more persons which term would include importing of goods on behalf of the main producer or client or between two or more persons and therefore, would include those intermediaries or brokers or agents who act from the point of importation to the point of consumption and supply of goods which is not the case in this instance as only installation and designing and such other services in India were provided were being provided in relation to and for Koch Membrane Systems, USA,which they would have been required to provide in India. Therefore, considering the scope of the contract, it becomes abundantly clear from the object clause itself that they were provisioning for services and arranging and facilitating provision of service in India which as per statutory provisions was always covered under the ambit of Place of Provisions Rules, 2012.
The extended period for demand was justified due to non-disclosure of relevant information by the appellant.
Concluion - i) The services provided by the appellant were intermediary services and subject to service tax. ii) The appellant's argument regarding the retrospective application of the amendment was rejected. iii) The services did not qualify as export of services and were not exempt from service tax. iv) The extended period for demand was justified due to non-disclosure of relevant information by the appellant.
Appeal rejected.
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2025 (2) TMI 9
Disallowance of CENVAT Credit - scope of SCN - the grounds on which the impugned order was passed in confirming such demand was not the subject matter of the dispute in the SCN issued by the Department - HELD THAT:- The allegations levelled therein against the appellants was in context with mis-match of figures in ST-3 returns prepared for the period between October, 2009 to March, 2010 and April, 2010 to September, 2010. The said show-cause notice had not proposed for disallowance of CENVAT Credit on the ground that the disputed services were not confirming to the definition of ‘input service’. Such ground was considered for the first time by the Department in third adjudication order (impugned herein). Since the showcause notice is a primary document based on which the entire proceedings were initiated against the appellants for confirmation of the CENVAT demand, no new ground can be taken subsequently at the time of adjudication stage, inasmuch as it is only the allegation levelled in the show-cause notice, which can be addressed to or acted upon by the adjudicating authority, while passing the adjudication order.
The issue with regard to taking of new ground/plea in the adjudication order, which was not being alleged in the show-cause notice, the Hon'ble Supreme Court in the case of COMMISSIONER OF CENTRAL EXCISE, NAGPUR VERSUS M/S BALLARPUR INDUSTRIES LTD [2007 (8) TMI 10 - SUPREME COURT] have held that the show-cause notice is a foundation in the matter to levy and recover of duty and if certain provisions have not been quoted or discussed therein, the adjudicating authority cannot invoke such statutory provisions to confirm the demand on the assessee.
The Hon'ble Supreme Court in the case of COMMISSIONER OF CUSTOMS, MUMBAI VERSUS TOYO ENGINEERING INDIA LIMITED [2006 (8) TMI 184 - SUPREME COURT] have also dealt with the identical issue, holding that the grounds did not find mention in the show-cause notice, then the Department cannot travel beyond such notice and the demand confirmed entirely on new grounds is liable to be set aside.
Conclusion - The demands confirmed in the impugned order was not dealt with or considered in the show-cause notice dated 16.07.2013 issued by the Department, such demand confirmed against the appellants cannot be sustained for judicial scrutiny, in view of the settled position of law.
Appeal allowed.
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2025 (1) TMI 1446
Applicability of Service Tax on certain services provided by the appellant - classification and exemption of services under the categories of Construction of Complex Service (CCS) and Management, Maintenance or Repair Service (MMRS) - HELD THAT:- It is obvious that in the course of adjudication, they were able to exclude certain activities not covered within the MMRS to building, etc., for which the feasibility under the exemption notification 45/2010-ST was also examined. It is also obvious that while examining the same, the Adjudicating Authority felt that they will fall either in the category of transmission or distribution of electricity and by considering that ‘in relation to’ is an expression which includes varied nature of activities and therefore, granted them the benefit of exemption notification in relation to such activities, which were not covered by virtue of section 98 of the Finance Act, 2012.
In respect of non-commercial MMRS to buildings, after the amendment in Finance Act, 2012, vide section 98, no demand will survive. For the MMRS to others, the exemption notification 45/2010-ST needs to be examined and we have examined the same. It is found that there was Notification No. 11/2010-ST dt.27.02.2010, which exempted the services provided for transmission of electricity. Similarly, in terms of Notification No. 32/2010-ST dt.22.06.2010, the services provided for distribution of electricity were exempt - the Adjudicating Authority has considered this notification 45/2010-ST to cover that entire activity of MMRS as falling in the category of transmission and distribution of electricity.
N/N. 45/2010-ST does not provide for such expression and it merely covers services in relation to transmission and distribution of electricity. The Adjudicating Authority has clearly brought out these facts in the impugned order and has categorically held that these activities are squarely covered within the ambit of transmission or distribution of electricity. In view of the same, we find that there is nothing wrong in the order of the Commissioner extending the benefit of notification 45/2010-ST for MMRS provided in relation to transmission and distribution of electricity to defence establishments.
Conclusion - i) The demand for Service Tax under CCS for the period prior to 01.07.2010 is unsustainable. ii) The MMRS provided to non-commercial government buildings, specifically defense establishments, are exempt from Service Tax for the period covered by the SCN, as per the amendment in the Finance Act, 2012, section 98. iii) The application of Notification No. 45/2010-ST to MMRS related to transmission and distribution of electricity is appropriate, and the exemption is applicable to the appellant's services.
Appeal allowed.
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2025 (1) TMI 1445
Leviability of tax on actual performance of management activities - Management Consultancy Services - services rendered by the appellants to clients located outside India qualify as "Export of Services" - exemption from service tax - service tax on out-of-pocket expenses (OPE) - extended period of limitation.
Leviability of tax on actual performance of management activities - HELD THAT:- The Tribunal in the case of appellant’s themselves [2014 (8) TMI 227 - CESTAT NEW DELHI] finds that 'Though the definition at Section 65(65) includes any service in connection with management of any organization, the scope of the definition gets restricted to services in relation to consultancy as is evident from the name given to the service and commercial understanding of the expression “Management or Business Consultancy.” - CESTAT has been consistently holding that actual performance of the activities do not fall under Management Consultancy Service. Therefore, the issue stands decided in favour of the appellants.
Export of services - HELD THAT:- Tribunal Ahmedabad Bench in the case of B A Research India Ltd. [2009 (11) TMI 213 - CESTAT, AHMEDABAD] held that 'The performance of testing and analysing has no value unless and until it is delivered to its client and the service is to be complete when such report is delivered to its client. Thus, delivery of report to its client is an essential part of the service report was delivered outside India and same was used outside India. This is not the disputed fact. We hold that the respondent satisfied the conditions of Rule 3(2) and accordingly the respondents are eligible for the exemption under Notification No. 11/2007-S.T. dated 1-3-2007.' - thus the Export of Services claimed by the appellants is in order and the impugned order cannot be sustained on this count.
Levy of service tax on the Out-of-Pocket Expenses - HELD THAT:- The dispute has been laid to rest by the decision in the case of Intercontinental Consultants and Technocrats Pvt. Ltd. [2012 (12) TMI 150 - DELHI HIGH COURT]. The learned Commissioner did not have the benefit of the said judgment while passing the impugned order. This Bench in the case of Smt. Ritu Arora [2023 (11) TMI 1130 - CESTAT CHANDIGARH] has followed the above decision. In view of the same, this issue also stands settled in favour of the appellants.
Appeal allowed.
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