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Service Tax - Case Laws
Showing 361 to 380 of 31004 Records
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2025 (1) TMI 896
Maintainability of petition - availability of alternative remedy - Levy service tax on the entire turnover of the value of the service provided by the petitioner - Business of retreading tyres - deemed sale component, already subjected to VAT - HELD THAT:- In the present case, the writ petitions are listed for final hearing and there is abundant material on record to demonstrate that the issue under consideration is squarely covered by the judgment of the Hon'ble Supreme Court in the case of Safety Retreading Company (P) Ltd3. Hence, the contention of alternative remedy raised by the Revenue is untenable and accordingly rejected.
The petitioner has furnished copies of tax invoices maintained by it, wherein the petitioner has indicated the value of the material and labour charges separately and as also indicated that in respect of the value of the materials the tax has been paid to State Government and with respect to the value of the labour charges the service tax has been paid to the Union Government. The said invoices have also been submitted to the tax authorities in the State Government and the State has passed re-assessment orders under KVAT Act.
The Hon'ble Supreme Court in the case of Safety Retreading Company (P) Ltd [2017 (1) TMI 1110 - SUPREME COURT] has clearly held that no dispute has been raised in the show cause notice (as in the present case also) with regard to the correctness of the figures furnished by the petitioner and at no point of time the respondents raised a plea as to the correctness of the invoices. The Division Bench of the Bombay High Court has also noticed a similar factual circumstance and relying upon the judgment of the Hon'ble Supreme Court in the case of Safety Retreading Company (P) Ltd, held that the Revenue did not dispute the invoices furnished. In the present case also, the respondents have not denied the correctness of the said bifurcation of the amounts made by the petitioner/assessee. Hence, the same is required to be accepted in the present case also.
In the present case, the petitioner having clearly bifurcated the amounts in invoices with respect to the amounts incurred towards material charges as also the amounts towards service charges and tax having been paid in respect of both the said amounts by classifying the same accordingly, the question of the respondent authorities seeking to levy service tax on the entire value mentioned in the invoices does not arise.
Conclusion - The petitioner/assessee is liable to pay the service tax only with respect to the service component under the State Act. The constitutional separation of tax powers upheld.
The writ petitions are partly allowed.
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2025 (1) TMI 895
Levy of service tax - Cleaning Service and Goods Transport by Road Service - evacuation and transportation of fly ash - time limitation - HELD THAT:- Timilar issue was before this Bench in the case of M/S MARSHALL CORPORATION LTD., VERSUS COMMISSIONER OF CGST & CENTRAL EXCISE, KOLKATA. [2023 (7) TMI 766 - CESTAT KOLKATA]. In this case, the entire consideration was sought to be taxed under the category of ‘Cleaning services’, without any bifurcation between Cleaning service and GTA services.
There are considerable force in the arguments of the appellant that if there is any movement of goods resulting in GTA Service, the Service Tax is required to be paid by the recipient of the service. It is not in dispute that the clients the corporate public limited companies, who are one of the seven categories of persons responsible to pay the Service Tax on Reverse Charge basis. On this count itself the confirmed demand under this heading is required to be set aside.
Time limitation - HELD THAT:- No case has been made out by the Revenue towards ‘suppression with an intent to evade’ Service Tax payment. Therefore, the confirmed demand for the extended period is not legally sustainable and the same is set aside on account of limitation also.
Conclusion - The activities undertaken by the Appellant are not chargeable to service tax under the category of 'Cleaning Service'. The demands for service tax under 'Cleaning Service' and 'GTA Service' were set aside. The demand for the extended period was deemed time-barred, and the penalty under Section 78 was not justified.
The appeal is allowed on merits fully and partly on account of limitation.
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2025 (1) TMI 890
Liability to pay service tax based on the full value Service Tax reflected in 38 invoices - requirement to remit amount collected as Service Tax from the client as per Section 73A - failure to consider CA certificate - extended period of limitation - HELD THAT:- The appellants have been maintaining that the full Service Tax was reflected in the Invoices, but such Invoices were never sent to the client, not they have paid the full Service Tax to the appellant. On the other hand, the appellants have passed rectification entries in their books of account to the effect that the total Tax is to be divided under the heading of VAT and Service Tax. The VAT amounts have been remitted to the concerned authorities.
The Chartered Accountant has issued the Certificate on 11.02.2015 clearly showing the way the Invoices which were taken for issue of demand in the Show Cause Notice. The date of this CA’s Certificate clarifies that this was obtained before the Personal Hearing and before the impugned Order was passed. The Adjudicating authority has recorded at page 15 of the OIO that the CA’s Certificate has been filed. But, instead of going through the details given therein, he has simply ignored the same and has not given any finding whatsoever as to why or how the certificate does not carry the defence of the appellant. It has been held in catena of decisions that once the CA’s Certificate is produced before the Adjudicating / Appellate authority, he is required to consider the same and if he is not in agreement with the same, he should rebut with proper reason.
The demand with interest an dpenalties set aside.
Extended period of limitation - HELD THAT:- The Show Cause Notice issued on 17.10.2014 for the period 2009-10 to 2012-13. The requisite details have been found from the books of accounts maintained by the appellant, which were made available to the Audit team. Even the proper rectification making entries were put up before them, which was not considered by the Audit team. Being a reputed Public Limited Company, the appellants are required to maintain proper books of accounts as well as rectify the mistakes by passing proper counter entries so as to nullify the same. Since they have undertaken all these steps, it is not found that they have indulged in any activity which would point out to suppression on their part. Hence, the confirmed demand in respect of the extended period is time barred. The confirmed demand pertaining to the extended period set aside on account of limitation and allow the appeal even on this ground.
Conclusion - It is not open for Revenue to arrive at a conclusion in disregard of the certificate without challenging or controverting the same with cogent evidence and reasoning. The extended period for tax demands requires evidence of intent to evade.
The appeal was allowed fully on merits regarding the Service Tax demand and partly on account of limitation concerning the extended period.
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2025 (1) TMI 848
Liability to pay service tax - rent-a-cab service - transactions involving International Travel House Limited (ITH) - demand on Debit Notes raised on other associate enterprises - Extended period of limitation.
Rent-a-cab service wherein the demand of Rs. 67,38,390/- has been confirmed - HELD THAT:- ITC Sonar is not retaining any amount from the amount being given by the guests. The entire amount is being given back by them to ITH. From the bills raised by ITH, it is seen that they are charging the Service Tax on the guests. This documentary evidence shows clearly that ITC Sonar has not provided any service either to the guests or to ITH. It is seen that ITH has not made any payment towards any consideration to ITC. Even otherwise, the Show Cause notice only alleges providing of renting a cab service to the guests. From the documentary evidence, it gets clarified that the appellant is not providing the rent-a-cab service to the guests. As a hotel, they may be indicating in their website various facilities being provided to the guests on its own - It is for the jurisdictional authorities to take up the matter and proceed against ITH, in case they are collecting the Service Tax under these bills and not remitting the same to the Department. In view of these factual details and documentary evidence shown, the confirmed demand of Rs 67,38,390 under the rent-a-cab service is not legally sustainable.
Debit Notes raised on other associate enterprises wherein the demand of Rs. 28,54,978/- has been confirmed - HELD THAT:- The appellant was registered with the Service Tax department and has been discharging the service tax payments and also they were filing their ST3 returns. Quantification of demand towards rent-a-cab services as well as debit notes raised on associate enterprises have been obtained by the Revenue from the books of accounts maintained by the appellant - it is not seen that the appellant has indulged in any suppression in these matters. Further, the appellant could be carrying bonafide belief that no Service Tax is required to be paid on the rent-a-cab service being actually rendered by ITH. In respect of the debit notes raised on other divisions, the appellant should have carried bona fide belief that since they are all part of the Divisions of the same company, there is no need to pay any Service Tax on such activities.
Extended period of limitation - HELD THAT:- The Department has not brought in any documentary evidence or proof to the effect that the appellant has indulged in any suppression so as to evade payment of service tax on these activities. Further, as submitted by the appellant, if service tax was required to be paid on such services, the appellant would be eligible to take the Cenvat Credit which makes the entire exercise as that of revenue neutral - the appellant cannot be fastened with the allegation of suppression with an intent to evade payment of service tax.
Conclusion - The court set aside the demands for service tax under both the rent-a-cab service and associated enterprises. The appellant cannot be fastened with the allegation of suppression with an intent to evade payment of service tax.
Appeal allowed.
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2025 (1) TMI 847
Effect of Notification of 2011 - retrospective or not - claim for exemption under the Notification of 2009 for the tax periods from 01.04.2008 to 31.03.2011 - Appellant ought to have resorted to the provisions of rule 6(7B) of the Service Tax Rules, 1994 or not - profit on settlement forms a part of the taxable value of services rendered by the Appellant or not - taxability of profit on the sale of foreign exchange to holders of EEFC accounts.
Whether the Notification of 2011 would operate retrospectively so as to permit the Appellant’s claim for exemption under the Notification of 2009 for the tax periods from 01.04.2008 to 31.03.2011? - HELD THAT:- After the amendment the intention was to confirm the exemption on a wider class of persons. This is what emerges from literal linguistic reading of the amending Notification of 2011. There is no ambiguity or lack of clarity in that Notification which requires us to take recourse to any other principles of interpretation. In our opinion, no two views are possible on this point. Further, the law is well settled that except in matters of procedure, there is a presumption that law operates prospectively unless there is compelling evidence to the contrary, being, inter alia, any express statement to that effect - The intent of the Notification of 2011 is a change in the legislative policy on to whom such exemption must be granted. This change in policy cannot be lightly held to be retrospective, particularly where there are no express words in the Notification that make it retrospective.
The question of whether an exemption granted operates retrospectively or prospectively is not one which requires us to choose between a liberal and a strict construction; the plain language of the Notification is perfectly clear and there is no ambiguity at all - there are no infirmity in the impugned order.
Whether the Commissioner is right in finding that the Appellant ought to have resorted to the provisions of rule 6(7B) of the Service Tax Rules, 1994 and paid service tax at the rate of 0.25% on the gross amount of currency exchanged? - HELD THAT:- Even if the factual findings of the Commissioner on this point are accurate, such findings are limited to a small number of transactions of the appellant. The revenue has been unable to sufficiently disprove the possibility that this variance could be otherwise justified. In any event, the occurrence of such variance is in a small number of transactions which could be on account of myriad reasons occasioned by particular circumstances. There appears to be nothing forthcoming from the Appellant’s submissions to explain the reasons for these differences.
The assessee is correct in submission that the option provided under Rule 6(7B) is an option available to it and not to the Revenue. Even if the Revenue was entirely correct, arguendo, in its findings of fact, the proper course of action for the Revenue would have been to determine the quantum of the hidden consideration and charge the same to tax in accordance with the provisions of section 66 and 67. These findings do not permit the Revenue to assign to itself the right to exercise the option under the aforesaid Rule. For these reasons, the contentions of the Assessee agreed in this respect and the relevant grounds of Appeal allowed.
Whether the Commissioner is right in finding that the profit on settlement forms a part of the taxable value of services rendered by the Appellant? - HELD THAT:- Notification No. 19/2009 granted exemption in respect of taxable service referred to in S. 65(105)(zm) or Section 65 (105) (zzk), when provided to a scheduled bank by another scheduled bank in relation to enter bank transactions of purchase and sale of foreign currency. Vijay notification 27/2011, the worlds ‘a scheduled Bank by any other scheduled Bank’ came to be substituted with the words ‘any bank, including a bank located outside India or money changer, by any other bank or money changer’ - the findings in the impugned order so far as this issue is concerned, is sustained.
Whether the profit on the sale of foreign exchange to holders of EEFC accounts is taxable? - HELD THAT:- Transaction of providing foreign currency and the transaction of repayment of proceeds are separate transactions happening at two distinct points of time and hence, the liability has been correctly fastened on the appellant. There is no flow of consideration in terms of money on these transactions since there is no conversion as such and hence, the same would not be taxable.
Conclusion - i) The intent of the Notification of 2011 is a change in the legislative policy on to whom such exemption must be granted. This change in policy cannot be lightly held to be retrospective. ii) The option under Rule 6(7B) is an option available to the assessee and not to the Revenue. iii) There is no flow of consideration in terms of money on these transactions since there is no conversion as such and hence, the same would not be taxable.
Appeal stands partly allowed.
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2025 (1) TMI 846
Classification of service - Business Support Service or Cargo Handling Services? - logistics services provided by the appellant - extended period of limitation - HELD THAT:- The classification of services is governed by Section 65 A ibid. It is not the case of the department that the appellant did not provide transportation service as a part of handling of cargo. The only reason advanced in the SCN is earning income over and above incurred expenditure on transportation. The Appellant is to provide transportation service and it invoices its customer for transportation service. Hence, the Revenue has failed to provide arny reason in support of its averment that the service is that of 'logistics' and it would be liable for service tax under the classification of "business support service”. Moreover, under the provisions of section 65A of the Finance Act, 1994 specific description is always preferred over general description. If the Appellant being an ICD has provided service of transportation by road, it cannot be classified under any other entry. The law does not authorize such classification. For providing transportation service, the liability cannot be fixed otherwise than on the recipient thereof in terms of Rule 2(1)(d)(v) of the Service Tax Rules, 1994.
Extended period of limitation - HELD THAT:- The period of dispute is from 2007-08 to 2011-12 and Show Cause Notices came to be issued on 19.10.2011 and 10.10.2012 invoking the extended period of limitation - from the facts borne on record that the appellant being an ICD had admitted its liability under the specific classification namely CHS and hence, the Revenue could not have presumed as to the knowledge of the appellant for the taxability of difference between transport income and transport expense as reflected in the books of accounts to be liable to Service Tax under ‘transportation charges’, which fact was not alleged even in Show Cause Notice. Hence, at best, the liability could have been restricted to the normal period of limitation.
Conclusion - The logistics services provided by the appellant were ancillary to CHS and not a separate BSS. Therefore, the demand for additional service tax under BSS was set aside.
Appeal allowed.
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2025 (1) TMI 845
Classification of the service provided by the appellant - to be classified under Construction of Complex Service (CCS) or WCS? - whether the demand of Service Tax on the Appellant under WCS is in order? - HELD THAT:- From the documents placed on record, there is a finding that insofar as the construction of projects was concerned, the Appellant had got itself registered with the State VAT department and paid applicable VAT. The effect is that the construction activity, as a builder, involved both service of construction as well as supply of materials; that being sale, applicable VAT stood remitted. So, the said activity clearly involved a composite contract hence, the service was covered under WCS.
Supreme Court in COMMISSIONER, CENTRAL EXCISE & CUSTOMS VERSUS M/S LARSEN & TOUBRO LTD. AND OTHERS [2015 (8) TMI 749 - SUPREME COURT] has clearly held that composite contracts where transfer of property in goods is involved shall be classifiable only under Works Contract Service and not under CCS/CICS.
Conclusion - The appellant's services were classifiable under WCS, but the demand for differential tax should only apply to the normal period. The penalty under Section 78 was set aside.
Appeal allowed in part.
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2025 (1) TMI 844
Classification of service - Business Auxiliary Services (BAS) or intermediary services - business of guiding and advising the foreign parties for bidding and negotiations - benefit of export of services for the period from July 2012 to March 2014 - HELD THAT:- The issue is no more res integra and is squarely covered by the Tribunal in the Appellant’s own case [2018 (7) TMI 1214 - CESTAT ALLAHABAD] for the previous period i.e. from April, 2007 to June, 2012. The present proceedings are for the period from July, 2012 to March, 2014.
The concept of intermediary becomes relevant for the purpose of determination of the place of provisions of services as per Rule 9 of Place of Provision of Services Rules, 2012. In case of intermediary, it is the location of services provider which is considered as place of provision of services for the purpose of levy of service tax for the period when the appellant is covered by the definition of the intermediary, the place of provision of service, the location of service provider i.e. the taxable territory of India. Hence the benefit of export of services could not be extended to the an intermediary located in India.
As per the Rule 3 of the Place of Provision of Services Rules in cases such cases the place of provision of service is location of the service recipient, which in the present case is outside India. Appellant are receiving payment against the provisions of these services in convertible foreign exchange. Thus, these services would qualify to get the benefit of export of services as per Rule 6 of the Service Tax Rules, 1994. Thus for this period there cannot be any levy of service tax and the demand made by the impugned order needs to be set aside.
Conclusion - The services provided by the appellant in respect of the sale of goods of associated group companies cannot be said to be services provided by intermediary as defined by said Rules ibid. The benefit of export of services would be available to the appellant.
Appeal allowed.
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2025 (1) TMI 843
Levy of service tax - Advances/Mobilization amount received from their customer - whether these amounts were advances or loan against Bank Guarantee from the clients as claimed by the appellant? - opportunity of hearing - principles of natural justice - HELD THAT:- It is not fair on the part of the learned counsel to submit that the impugned order was passed behind their back or without giving opportunity of hearing to them. Sufficient opportunities were granted to the appellant and twice the Manager-Taxation of the appellant also appeared before the said authority and took time for filing reply and necessary documents in support of their claim but nothing was filed. Six times adjournment was granted by the said authority including twice on the request of their Manager Taxation. Although the illness of their Manager-Taxation was genuine ground but in his absence someone ought to have appeared before the adjudicating authority on behalf of appellant.
There are no fault on the part of the adjudicating authority for adjudicating the issue ex-parte. Learned counsel also submits that all the documentary evidences have been filed by them in support of their claim.
Conclusion - In the present case no personal hearing was sought. Even then in the interest of justice seven personal hearing was granted i.e. adjournments were granted for six times. Service tax is applicable on advances unless adequately proven otherwise.
Appeal is allowed by way of remand to the learned Commissioner for denovo adjudication.
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2025 (1) TMI 842
Liability of builder to pay service tax - builder is liable to pay service tax on receipt of entire considerations from the buyer after issuance of ‘occupancy certificate’ when the term used is ‘Completion Certificate’ in the exception provided in Section 66E(b) of the Finance Act, 1994 or not - HELD THAT:- The main reason for issuance of clarification by the Ministry of Finance dated 26.10.2015 is that after the issuance of occupancy certificate by the Brihanmumbai Municipal Corporation (BMC) the sale of flats/dwelling etc. is mere transfer of title in immovable property and does not amount to any service and hence falls outside the purview of Section 65B (44) of the Finance Act, 1994. The press release is confined to the cases pertaining to BMC as it has been issued in response to a representation made by the Real Estate Developers of Mumbai to the Ministry of Finance claiming exemption in cases where the Occupancy Certificate were issued by BMC without there being any completion certificate. But the clarification cannot be said to confine only to BMC as it clarifies the provision and hence we have no doubt in holding that the clarification is equally applicable on the Vasai-Virar Municipal Corporation as well, since the said clarification is qua the provision of Finance Act, 1994 which is applicable on everyone whether it is BMC or any other Municipal Corporation.
In the case in hand the Occupancy Certificate is not disputed and its issuance by Vasai-Virar Municipal Corporation is also an admitted fact. The Revenue i.e. the appellant herein is not casting any doubt on the said certificate and their only concern is that the said Occupancy certificate has not been issued by BMC but by a different Municipal Corporation, therefore the clarification issued by Ministry of Finance will not be applicable which, in our view, is totally unfounded. The expression used in Section 66E(b) ibid is ‘after issuance of completion certificate’ which, in our view, can’t be limited to only the completion certificate - it can be said that the pre-condition for issuance of occupancy certificate is the completion of building and its inspection by Commissioner of concerned Municipal Corporation being the competent authority or anybody on his behalf.
Conclusion - Having received the occupancy certificate from competent authority i.e. Vasai-Virar City Municipal Corporation and having sold the units/flats in issue subsequent to the date of issue of the said occupancy certificate, the appellant is not providing the declared services of construction of complex/building, etc. to any of such buyers and therefore the same falls within the exception provided in Section 66E(b) ibid. The respondent was not liable for service tax on the sale of flats where the consideration was received after the issuance of an occupancy certificate.
Appeal dismissed.
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2025 (1) TMI 791
Condonation of delay in filing appeal - Levy of service tax - Auction of abandoned imported goods by the CONCOR - ground rent/storage rendered towards the un-cleared/un-claimed cargo of the importer - Amount accrued to CONCOR under Section 150(2)(d) of the Customs Act, 1962 - consideration for the provision of storage and warehousing services or not - it was held by CESTAT that 'the issue whether the service tax can be demanded on the sale proceeds of the auction of the abandoned imported goods is no longer res integra and has been decided in favour of the assessee and it has been settled that in the whole transaction, no service recipient exists and, therefore, there is no question of providing any service to any person.'
HELD THAT:- There is a delay of 138 days in filing the appeal which has not been satisfactorily explained by the appellant.
The Civil Appeal is, accordingly, dismissed on the ground of delay.
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2025 (1) TMI 790
Condonation of delay in filing appeal - Extended period of limitation - Petitioner’s liability for payment of the service tax on works contracts executed during the period of 2014-15 to 2017-18 - It is the petitioner’s case that in terms of Section 129 of the Finance (No. 2) Act, 2019, no proceedings can be initiated in respect of service tax for the period 2014-15 to 2017-18 and no further demands can be raised - It was held by High Court that 'NOIDA does not require to be registered under any Act as a body corporate, as it has been constituted by the Uttar Pradesh Industrial Area Development Act, 1976 as a body corporate. Thus, clearly the Revenue has misunderstood the response received from NOIDA as is reflected in the impugned show cause notice.'
HELD THAT:- There is a delay of 330 days in filing the Special Leave Petition which has not been satisfactorily explained. Even otherwise, on going through the Special Leave Petition and there are no merit in the same.
The Special Leave Petition is, therefore, dismissed on the ground of delay as well as on merits.
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2025 (1) TMI 789
Validity of payment under the Sabka Vishwas (Legacy Dispute Resolution) Scheme (SVLDRS), 2019, made after the due date - attachment of the petitioner's property - HELD THAT:- As per the SVLDRS 2019, the petitioner filed Sabka Vishwas Scheme application on 02.10.2019 and subsequently SVLDRS Form-3 was issued by the designated committee for payment. The petitioner had to pay an amount of Rs. 35,23,866/- by the due date i.e. by 30.06.2020. But he failed to pay the said amount by the said date. The plea taken by the petitioner was that due to COVID-19 pandemic, as the business was completely closed, they could not generate any funds, could not make payment within the said time. However, as per the petitioners they accumulated funds and paid a sum of Rs. 15,00,000/- on 07.01.2021 and Rs. 20,23,866/- on 01.03.2021 and completed the payment of balance amount.
Thus, the amounts recovered were not payments made by the petitioner within the stipulated period, but subsequently by the Department in the process of recovery of arrears. As the petitioner could not comply the terms as mentioned in the scheme and had not made the payments within the stipulated period, the petitioner could not avail the benefit offered under the said scheme. The petitioner was required to follow the provisions of the scheme in toto and to pay the amount determined under SVLDRS Form-3 within the stipulated time in terms of Section 127 (4) of the Finance Act, 1994. The recovery made by the Department under Section 87 of the Finance Act, 1994 could not be considered as payment made by the petitioner under SVLDRS scheme.
Since there was a legal impediment because of which the petitioner therein could not comply with the requirement, interference was made. This is trite that a singular different fact/point may change the precedential value of a judgment.
Conclusion - As the petitioner was having interest in the firm and became Managing Partner of the firm after entering the reconstituted partnership deed dated 26.09.2015, there is no need to interfere with the attachment order passed by the Department against the petitioner. As such, there are no merit in the contention of the learned Senior Counsel for the petitioner to raise the attachment order and to allow the petition.
Petition dismissed.
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2025 (1) TMI 788
Levy of service tax - miscellaneous income of Rs. 6 crores declared by the respondent to the Income Tax Department - imposition of penalty under Section 78(1) of the Finance Act, 1994 - HELD THAT:- The present demand was proposed based on the statement of the director of the respondent where he simply stated that the amount disclosed to IT department was received from construction services. Apparently and admittedly, the respondent was providing various taxable services the said statement is not admissible in evidence till corroborated by any documentary evidence. Subsequent to the impugned order also the department has not produced any evidence to prove that the respondent had generated said disputed income / amount disclosed to IT department on account of providing taxable services. The proposal of demand of service tax on the income declared under survey to IT department cannot otherwise sustain. The proposal was purely on the basis of assumption and presumption. Hence, there are no infirmity in the part of the order challenged by the department.
Conclusion - Such a serious charge of evasion of service tax requires the Department to produce sufficient and tangible corroborative evidences and it cannot simply be based on presumptions and assumptions. The original adjudicating authority's decision to drop the demand for service tax on the miscellaneous income upheld, finding no evidence to support the department's claims.
The appeal filed by the department is hereby dismissed.
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2025 (1) TMI 787
Refund of service tax paid - rejection on the ground that appellant has failed to pass the bar of unjust engagement - HELD THAT:- As it is evident from the record that service recipient has not remitted any Service Tax towards the services rendered by the appellant. In that circumstances the appellant has passed the bar of unjust engagement, therefore, bar of unjust engagement is not applicable to the facts of this case.
Larger Bench of this Tribunal in the case of M/S VIAVI SOLUTIONS INDIA PVT. LTD. VERSUS THE COMMISSIONER OF CGST, GURGAON-I [2024 (6) TMI 187 - CESTAT CHANDIGARH] wherein it has been held that in case of refund claims filed under Service Tax laws, the decision of ITC LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE, KOLKATA -IV [2019 (9) TMI 802 - SUPREME COURT (LB)] is not applicable as the same is related with the cases of Customs. In that circumstances the decision of ITC Ltd. is not applicable to the facts of the case.
The appellant is entitled to claim the refunds - Appeal allowed.
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2025 (1) TMI 736
Entitlement for benefit of the Service Tax Voluntary Compliance Encouragement Scheme (VCES) - payment of the principal tax dues after the cut-off date of 1st March, 2013 done - Rejection of assessee’s declaration filed under the scheme on 23rd July, 2013, by a communication dated 25th July, 2014 on the ground that certain sums of money were deposited by the assessee prior to coming into force of the scheme - HELD THAT:- The communication dated 25th July, 2014 cannot be construed to be an order in the strict sense for an appeal to be preferred. That apart, the CBEC by Circular dated 8th August 2013 issued certain clarifications with regard to the implementation of the scheme and it has been clarified that the scheme does not have a statutory provision for filing of an appeal against the order for rejection of declaration under Section 106 (2) by the designated authority.
The cut-off date under the scheme which is sacrosanct and cannot be ignored by the department - the cut-off date fixed under the scheme is the very crucial factor and this aspect was noted in the case of Sadguru Construction [2014 (5) TMI 219 - GUJARAT HIGH COURT] and it was held that if the intention of the legislature was to exclude any tax deposited before framing of the scheme, the same could have been provided in plain language. On the contrary, the legislature excluded from the purview of declaration only those taxes which were already paid by 1st March, 2013 and, therefore, the period between the 1st March, 2013 and 10th May, 2013 would, by necessary implication of the provision of the scheme, be covered for declaration under the scheme itself.
Conclusion - Payments made after the cut-off date but before the scheme's introduction are eligible under VCES. The assessee is entitled to the benefit under scheme and the declaration of the assessee should be accordingly processed. The rejection of the VCES declaration is not an appealable order.
Appeal allowed.
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2025 (1) TMI 735
Exemption from service tax - dropping of demand on the ground that the construction services provided to M/s PGCIL and to MCD both are the constructions meant for the commercial activity having commerce/profit element - Levy of service tax - hire charges on account of giving DG sets, motor graders, hydraulic, excavator etc. - charges received for constructing parking for MCD - site preparation services - New Grounds of appeal.
Exemption from service tax - dropping of demand on the ground that the construction services provided to M/s PGCIL and to MCD both are the constructions meant for the commercial activity having commerce/profit element - HELD THAT:- The demand is alleged to have wrongly been dropped with respect to M/s PGCIL. The activity is not for construction of infrastructure for electricity transmission lines but is actually a site preparation services. It is observed that in none of the show cause notices the respondent assessee is alleged to have rendered site preparation services to either to M/s PGCIL or to MCD or any other of its clients including M/s VSK Infrastructure. Thus, this ground of appeal raised by the department is beyond show cause notice hence cannot be dealt with at this stage of appeal.
In the present case, respondent has provided services to M/s PGCIL a public sector undertaking which admittedly is engaged in setting up of transmission lines for transmission of electricity and the respondent has provided the infrastructure for the same. Any service provided in relation to transmission of electricity stands exempted from whole of the service tax liability in terms of Notification No. 11/2010-ST dated 27.02.2010. This notification has been relied upon by the original adjudicating authority while dropping the demand vis-à-vis the demand of service tax vis-à-vis projects executed for M/s PGCIL. There is no evidence produced by the department to prove that the service provided by appellant is not for electricity transmission infrastructure. Hence, there are no infirmity in the order to that extent.
Levy of service tax - hire charges on account of giving DG sets, motor graders, hydraulic, excavator etc. - HELD THAT:- Giving goods on Hire with effective control and possession thereof thus stands ousted from the scope of service tax leviability. Since there is no evidence produced by the department on record showing that right to possession and effective control of the equipments given on hire was retained by the respondent – assessee, there are no infirmity in the order under challenge where the demand on hire charges has been dropped.
Levy of service tax - charges received for constructing parking for MCD - HELD THAT:- The services provided by the respondent are not the services provided to the governmental authority (MCD) but it was provided to a private company viz. M/s VSK Infrastructure Ltd. Otherwise, also the parking for MCD being a paid parking and as such the construction thereof was meant for making profit/revenue generation for the MCD. These facts are sufficient for us to hold that the mega exemption No. 25/2012-ST dated 20th Jun 2012 Entry No. 12(a) which exempts the activity in relation to construction provided to the Government or governmental authorities from service tax levy is not applicable to the respondent – assessee - the MCD parkings are for generating Revenue hence construction thereof is the construction for a building meant for commerce. Resultantly, irrespective the MCD is a governmental authority meant to carry out the functions entrusted in Article 243(w) of Constitution of India but the parking being meant as a commercial project of MCD - the original adjudicating authority has wrongly relied upon the said notification while dropping the demand for the construction services being provided by the respondent to M/s VSK Infrastructure Ltd,/MCD. The impugned order in original is, therefore, set aside to this extent.
Levy of service tax - site preparation services - New Grounds of appeal - HELD THAT:- The original show cause notice did not allege "site preparation services - the department could not introduce new grounds at the appeal stage.
Conclusion - i) The respondent provided services to PGCIL for electricity transmission, which is exempt from service tax. ii) The demand for service tax on hire charges was correctly dropped. iii) The demand for service tax on construction services for MCD was reinstated. iv) The department could not introduce new grounds at the appeal stage.
Appeal allowed in part.
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2025 (1) TMI 734
Levy of service tax - Business Auxiliary Services - activity of distributing and selling SIM Cards and Air Time Scratch Cards by the appellant - HELD THAT:- The issue is no more res integra and has been decided in favour of the assessees in a number of judgments. This Bench in the case of Jalandhar Sales vs. Commissioner of CE & ST, Ludhiana [2024 (5) TMI 561 - CESTAT CHANDIGARH] has held that 'the tribunal has held that the activity of purchase and sale of SIM card belonging to BSNL where BSNL discharged the service tax on the full value of the SIM cards, does not amount to providing business auxiliary services and confirmation of demand on the distributor for the second time is not called as per Section 65(19) and 65(105) (zzb) of Finance Act, 1994.'
Conclusion - Appellant are not liable for service tax for the sale of SIM cards.
Appeal allowed.
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2025 (1) TMI 682
Exemption from service tax - Business Auxiliary services or not - Cleaning & Grading service - Handling & Transportation service - extended period of limitation - HELD THAT:- The cleaning and grading of agricultural produce is held to be covered under production and processing of goods. It is observed that the production and processing of goods for, or on behalf of, the client if provided in relation to agricultural is exempted from whole amount of tax vide Notification No. 19/2005 dated 07.06.2005 which amended the previous Notification No. 14/2004 dated 10.09.2004 with respect to exemption to specified services in relation to Business Auxiliary Service - Circular No. 143/12/2011 dated 26/5.2011 which clarifies that the agricultural produce when subject to processing if retain their essential characteristics at the output stage, the process undertaken on or behalf of client should be considered as covered by the expression ‘in relation to the agriculture’.
Cleaning and grading service - HELD THAT:- The cleaning and grading activity was for few of the agricultural products which were warehoused by the appellants for their clients and that this activity did not change the essential characteristics of the agricultural product stored /warehoused by the appellant, the activity has to considered as the one in relation to the agriculture which is exempted from payment of tax - The Hon’ble Apex Court in the case of COMMISSIONER OF CUSTOMS, CENTRAL EXCISE & SERVICE TAX VERSUS M.L. AGRO PRODUCTS LTD. ETC. ETC. [2018 (7) TMI 1581 - SC ORDER] has held that threshing and redrying of tobacco leaves, being an activity “in relation to agriculture” is covered under entry “production of goods on behalf of client in relation to agriculture” which is entitled for exemption under Notification No. 14/2004-S.T. Hence, Service Tax is not payable C.B.E. & C. Circular No. 143/12/2011-S.T. dated 26- 5-2011, also clarifies the same. Thus even with the introduction of negative list, said activity remained non-taxable.
Handling and transportation charges - HELD THAT:- The cargo handling service under section 65 (21) means loading, unloading, packing, or unpacking of cargo and includes cargo handling service provided for freight in special container service provided by a container freight terminal or any other terminal meant to be transported by any means of transportation namely truck, rail, ship or aircraft buy the authorities likecontainer cooperation India, Airport Authority of India, in Land Container Depot, Container Freight Station etc. The department clarification no. B11/1/2002 -TRU dated 1.08.2002 clarifies that the cargo handling services provided in relation to storage of agricultural produced are covered under storage and warehousing services and have been exempted from the levy of service tax. In view thereof, the handling and transport of agricultural produce was also not taxable even prior 1.07.2012 hence the demand is held to have been wrongly confirmed.
Conclusion - The two activities are held to be part of one service i.e. storage and warehousing of agricultural produce. The said composite activity is out of service tax net for pre as well as post negative list period, hence it is held that even partial demand of Rs.3,66,314/- has wrongly been confirmed by the adjudicating authority below.
Appeal allowed.
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2025 (1) TMI 681
Refund of service tax paid - services used in connection with the export of goods under Notification No. 41/2007-S.T. dated 06.10.2007 - applicability of time limitation - procedural lapse of filing refund claims beyond the prescribed sixty days - HELD THAT:- The refund has been rejected on the procedural ground that the Appellant has filed the refund claim for a particular quarter wherein some of the bills and invoices were dated subsequent to the quarter ending date which is beyond the time limit of 'sixty days' prescribed under Notification No. 41/2007-S.T. dated 06.10.2007. In some cases, the exports had also been made prior to the date of invoice. Accordingly, the ld. adjudicating authority has rejected the refund claims on the ground that these input services could not be related to the goods exported in that quarter.
In this regard, it is observed that the Government has realized the difficulties faced by exporters and issued the Notification No. 32/2008-S.T. dated 18.11.2008, extending the time limit of sixty days for filing the refund claim to six months. This beneficial Notification can be applied retrospectively so as to allow refund applications filed within the period of six months from the quarter ending date. The substantial benefit of refund cannot be denied merely on account of non-fulfilment of procedural conditions prescribed under the said Notification.
This view has been taken by this Tribunal in the case of COMMISSIONER OF CGST & CENTRAL EXCISE, JAMSHEDPUR VERSUS M/S RUNGTA MINES LTD. [2023 (9) TMI 1093 - CESTAT KOLKATA] wherein it has been held that the extension of the time limit for filing the refund claim from “60 days” to “six months” being a piece of beneficial legislation, has to be considered as a retrospective amendment.
Conclusion - The Appellant is eligible for the refund of input services as claimed by them, as provided under Notification No. 41/2007-S.T. dated 06.10.2007.
Appeal allowed.
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