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Service Tax - Case Laws
Showing 61 to 80 of 30956 Records
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2025 (3) TMI 904
Wrong availment of CENVAT Credit - short payment of service tax at the time of audit - lack of evidences - levy of penalties - levy of late fine - invocation of extended period of limitation - penalties - HELD THAT:- It is found that the appellant had paid the amounts towards the irregularly availed CENVAT Credit and Service Tax short paid by them on being pointed out during the audit and much before the issuance of show cause notice, the matter in respect of the said demands should have been closed in terms of Section 11 A (2) of the Central Excise Act, 1944 or Section 73 (3) of the Finance Act, 1994.
Section 11 A (2) of the Central Excise Act, 1944 or Section 73 (3) of the Finance Act, 1994 clearly provide that appellant could have paid the amounts short paid by him either on his own ascertainment or on being pointed out by the department. Undisputedly appellant has paid the amounts on being pointed out by the audit. That being so the proceedings for the recovery of the said amounts by issuing show cause notice under Section 11A of the Central Excise Act, 1944 or Section 73 of Finance Act, 1994 for the recovery of the amounts already deposited are bad in law and the penalties imposed equivalent to those amounts cannot be justified.
Demand of interest - HELD THAT:- There is no clarity about the interest payment for the delay in payment of taxes/ duty. Appellant has claimed that they had paid the interest also which should have been apportioned against the demand of interest. However they have not produced any evidence in respect of the payment of interest. Time of ten days allowed on the date of hearing to the counsel to produce the details and evidence of payment of interest. However even after more than three months from the date of hearing nothing has been produced before me. Thus there are strong reasons to reject the claim made by the appellant towards the payment of interest. Accordingly the demand of interest upheld by the impugned order is again confirmed.
Levy of late fee - HELD THAT:- Appellant has not challenged the late fee levied on the delay filing of their returns by them. The demand for late fee is also upheld.
Conclusion - i) The denial of CENVAT credit was upheld due to a lack of evidence from the appellant. ii) The imposition of penalties was set aside due to the appellant's prior payment of duty and interest. iii) The demand for late fees and service tax under RCM was confirmed. iv) The invocation of the extended period was deemed appropriate. v) The demand for interest was confirmed due to the appellant's failure to provide evidence of payment.
The impugned order is modified to the extent of setting aside the penalties equivalent to irregularly availed cenvat credit and service tax short paid by the appellant - Appeal allowed in part.
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2025 (3) TMI 903
Admissibility of refund claim - entitlement for exemption under S.No. 12(a) of Notification No. 25/2012-ST for services provided to Raipur Development Authority (RDA) and Naya Raipur Development Authority (NRDA) - S.No. 12(e) covers the excluded category, which has been left out by the Commissioner or otherwise while extending the benefit under S.No. 12(e) to RDA - benefit under S.No. 39 covers a situation where the service provider is not a Governmental Authority - invocation of extended period of limitation - penalty.
Whether S.No. 12(a) would be admissible to appellants or otherwise? - HELD THAT:- It is found from the submissions made by the learned Special Counsel, as also from the grounds taken by the Adjudicating Authority that these two authorities are clearly engaged in commercial activities. It is also found that the other arguments taken by the learned Advocate is that their work is not for commercial use, per se, and therefore, they would be covered within the ambit of S.No. 12(a). This argument is also not correct, inasmuch as the exemption notification has to be construed strictly in terms of the wordings of the notification and a plain reading would obviously indicate that if the service was for use for commercial purpose then it would not get covered. In this case, it is obvious that all these activities are for value addition of the plot and township, which are being sold at commercial rates and terms by these two authorities, therefore, these services are obviously provided to the authorities, who are otherwise engaged in commerce. In view of the same, there are no infirmity in the impugned order in denying them the benefit under S.No. 12(a) of the notification 25/2012-ST.
Whether S.No. 12(e) covers the excluded category, which has been left out by the Commissioner or otherwise while extending the benefit under S.No. 12(e) to RDA? - HELD THAT:- While the learned Advocate has contested that all these activities are civic in nature and therefore, they should be covered under the notification and that the wordings under S.No. 12(e) of the Notification clearly covers even the activities of work relating to reservoirs, sumps and pumping stations, we find that the notification only covers three activities viz., pipeline, conduit or plant for (a) water supply, (b) water treatment, (c) sewerage treatment or disposal. Therefore, a plain reading of the entry would indicate that reservoirs and sumps would not be covered on the plain reading. However, we feel that since the expression used is ‘plant’, this would include pumping stations. Further, a plant for either water supply or water treatment or sewerage treatment or disposal would invariably also have certain reservoirs or sumps or pumping stations attached thereto - the facts have not been correctly appreciated insofar as denial of benefit under S.No. 12(e) of the notification in respect of reservoirs, sumps and pumping stations is concerned and accordingly, this needs to be remanded back to the Original Adjudicating Authority. It is, however, made clear that the expression ‘plant’ used in the entry would cover pumping stations and also interconnected reservoirs and sumps meant to feed or collect water, sewerage, etc., from these pumping stations.
Whether benefit under S.No. 39 covers a situation where the service provider is not a Governmental Authority? - HELD THAT:- The Adjudicating Authority was examining the broad description of the project and observed that unlike the works executed for RDA, in the case of NRDA, there is no breakup for each specified work and therefore, he did not allow the benefit in respect of WCS provided to NRDA in terms of S.No. 12(e) of the notification - there is clear breakup in case of activities provided to RDA, which helped in taking decision as to what services were covered or otherwise within the ambit of S.No. 12(e). However, similar breakups were not provided in case of NRDA, though it is apparent that on a broader level, they are almost similar to the activities as that of RDA - the matter needs to be remanded back to the Original Adjudicating Authority to reexamine the eligibility under S.No. 12(e) in respect of WCS provided to NRDA on the similar lines as that of RDA and also keeping in view, the as regards exclusions i.e., reservoirs, sumps and pumping stations.
Whether, in the facts of the case, limitation has been rightly invoked or otherwise and whether penalty has been rightly imposed? - HELD THAT:- There was no substantive and positive grounds for alleging that there was deliberate and willful misstatement or suppression by the appellant to evade service tax in the facts of the case and therefore, the invocation of extended period of limitation in terms of proviso to section 73(1) is not sustainable. Accordingly, the decision of the Adjudicating Authority in the impugned order to the extent upholding the invocation of extended period is liable to be set aside and is accordingly, set aside. Further, since the extended period is not invocable, the penalty imposed is also not tenable and accordingly, the same is also set aside.
Conclusion - i) The denial of exemption under S.No. 12(a) due to the commercial nature of the services provided to RDA and NRDA upheld. ii) The appellants were not eligible for exemption under S.No. 39 as they were not a governmental authority. iii) Since the extended period is not invocable, the penalty imposed is also not tenable and accordingly, the same is also set aside.
Appeals are allowed by way of remand to the Original Sanctioning Authority.
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2025 (3) TMI 902
Levy of service tax - transportation or insurance related expenses recovered in excess from the buyers - HELD THAT:- It is found that the appellant discharged the excise duty liability of Rs.10,04,21,540/-, i.e. Rs.7,86,81,141/- and Rs.2, 17,40,399/- on excess freight and insurance charges, respectively, consequently, the levy of service tax is unsustainable.
The activity of arranging transportation of goods till the dealers premises cannot be classified under ‘Business Auxiliary Service’ and, therefore, no service tax is payable on transportation related expenses recovered in excess by the appellant from their buyers. It is an activity which is directly related to the supply of goods on which excise duty has been paid by the appellant and once the excise duty has been paid, no service tax is leviable on the said transaction. Although, the learned counsel for the appellant has raised several other contentions, however, since the issue is decided on merits in favour of the appellant, it is no more relevant to record a finding on them.
Conclusion - When excise duty is paid on the transaction value, which includes transportation and insurance charges, no additional service tax is exigible on those charges as they are part of the supply of goods.
Appeal allowed.
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2025 (3) TMI 901
Classification of services - Works Contract Services or Construction of Complex Services - period from April 2009 to September 2012 - services provided to the Housing Board Haryana are exempt from service tax - HELD THAT:- The matter is covered by the decisions of Bajrang Lal Gupta Vs Commissioner of Delhi-III [2023 (6) TMI 246 - CESTAT CHANDIGARH] for the Pre Negative List period and by Bharat Bhushan & Company Vs State of Haryana [2016 (8) TMI 722 - PUNJAB AND HARYANA HIGH COURT] for the Post Negative List period.
Bajrang Lal Gupta deals with the exemptions for the services provided for the Pre Negative List period holding that 'the Hon'ble Apex court in the case of CCE v. Larsen & Toubro Limited [2015 (8) TMI 749 - SUPREME COURT] has settled the issue relating to works contract service which includes supply of material and labour for consideration and the same is taxable only from 1-6-2007.'
It was also held that 'even for the period after 1.06.2007, various decisions of the Tribunal have consistently held that the composite contract or works contract service even after 1-6-2007 cannot be taxed under Construction of Complex Service under section 65(105) (zzh) read with Section 65 (30a) of the Finance Act, 1994.'
Conclusion - i) The appellant's services were correctly classified as Works Contract Services and not subject to service tax under Construction of Complex Services. ii) The services provided to the Housing Board Haryana were exempt from service tax as they were provided to a governmental authority for non-commercial purposes.
Appeal allowed.
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2025 (3) TMI 900
Calculation of service tax - requirement of inclusion of value of free diesel provided to the service provider, namely, M/s. R.K. Carriers - liability of service tax on the appellants under reverse charge mechanism - eligibility for exemption benefit in terms of N/N. 34/2004- ST dated 03.12.2004.
Whether the appellants are required to include the value of free diesel provided by them to the service provider, M/s. R.K. Carriers? - HELD THAT:- Issue decided by Hon’ble Apex Court in the case of Bhayana Builders [2018 (2) TMI 1325 - SUPREME COURT] where it was held that 'the value "free supplies" by a construction services recipient, for incorporation in the constructions would not constitute a non-monetary consideration to the service provider nor form part of the gross amount charged for the services provided.' - thus, the value of free diesel should not be included in the taxable value.
Whether there was any liability of service tax on the appellants under the reverse charge mechanism? - HELD THAT:- It is true, as contended by Revenue, that even if one of the literal meanings of the expression used, namely free supplies used is considered as the legal meaning as well, construction service providers may not be handicapped as they may seek benefits under Notification No. 12/2003-ST. However the fact that the assessees have an alternative recourse to avoiding the rigor cannot be the criterion for interpreting the Explanation. This contention by Revenue proceeds on a fallacious comprehension of Notification No. 12/2003-ST. The benefits under this Notification are only in respect of the value of goods and materials sold by a service provider to the recipient of a taxable service. In the case of free supplies by the recipient there is no sale or transfer of title in the goods and materials in favour of the service provider, at any point of time. Therefore when free supplied goods and materials are incorporated into the construction would be no sale by the provider to the recipient either. Notification No. 12/2003-ST would therefore be inapplicable.” - the value of free diesel should not be included in the gross amount for service tax computation, as the notifications do not mandate such inclusion.
Whether appellants are eligible for the exemption benefit in terms of N/N. 34/2004-ST dated 03.12.2004? - HELD THAT:- Clause (ii) of Notification No. 34/2004 applies to the appellant. However the quantification is not apparent on record. Resultantly, we remand the matter back to the Original Adjudicating Authorities to quantify the amount of the differential duty, if any, to be recovered from the appellant, however, after arriving at a proper calculation showing as to whether the calculation arrived at by appellant is correct. If not, the reasons to be recorded - Commissioner (Appeals) is required to look into the calculation given by the appellant in their written submissions and also to provide two opportunities of personal hearing to the appellant. Order thereafter be passed within two months of the receipt of the present order.
Conclusion - i) The value of free diesel provided by the appellant is not includible in the taxable value. ii) The value of free diesel should not be included in the gross amount for service tax computation, as the notifications do not mandate such inclusion. iii) There are discrepancies in the calculation of the gross amount charged and remanded the matter for recalculation to determine if the exemption applies.
The appeal is allowed by way of remand.
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2025 (3) TMI 849
Reimbursement of service tax component in terms of tender documents followed by contract in the light of subsequent amendment of law relating to Service Tax Regime w.e.f. 1.7.2012 - arbitration clause barring the invocation of writ jurisdiction for the resolution of disputes concerning the reimbursement of the service tax component.
Arbitration clause barring invocation of writ jurisdiction - HELD THAT:- The arbitration clause is hit by the Apex Court decision in CENTRAL ORGANISATION FOR RAILWAY ELECTRIFICATION vs. ECI SPIC SMO MCML (JV) [2024 (11) TMI 542 - SUPREME COURT (LB)]. Therefore, the subject arbitration clause is liable to be ignored for all practice purposes.
Secondly, the question is not as to the liability to pay the service tax in respect of services in question; it is essentially as to who should pay this in the light of change of legal regime of taxation post conclusion of contracts - there being no repudiation of liability for discharging the service tax, it cannot be argued that there is an arbitrable dispute merely because a question as to who should pay, eventually arises.
An arbitration clause of the kind even otherwise does not constitute a China Wall against exercising writ jurisdiction. In appropriate cases, Writ Court can grant relief when the answering respondent happens to be Article 12-Entity - It is not that the Writ Courts should invariably deny relief merely because the other side disputes the fact matrix, provided that the disputed facts can be ascertained from the pleadings & record.
Liability of Railways to Reimburse Service Tax - HELD THAT:- On the principle of reimbursement as such, there is no dispute at all. The dispute is the extent of reimbursement in the sense that what is payable by way of service tax because of paradigm shift in the Legal Regime, with effect from 1.7.2012 i.e. post-contract period.
Interpretation of Tender/Contract Clauses - HELD THAT:- Section 83 of Finance Act, 1994 read with Sections 12A & 12B of Central Excise Act, 1944 raises a presumption that the incidence of duty can be passed on to the buyer unless contrary is proved and therefore, being an indirect tax, has to be borne by the service recipient vide Satya Developers Pvt. Ltd. vs. Pearey Lal Bhawan Association [2015 (10) TMI 2667 - DELHI HIGH COURT] and Meattles Pvt. Ltd. Vs. HDFC Bank Ltd. [2012 (10) TMI 685 - DELHI HIGH COURT] - When the contracts in question were entered into in the year 2011, both the parties had not contemplated change of legal regime with effect from 1.7.2012 from Positive List to Negative List eventually giving rise to new tax liability. It is not just change of rates of tax, but, very taxability.
Analogous Application of Section 64A of the Sale of Goods Act, 1930 - HELD THAT:- Section 64A as such cannot be invoked because the case does not relate to tax on goods; however that does not mean that the wisdom of its underlying principle cannot be made use of by analogy - The recipient of services like the buyer of goods has to bear the new levy of service tax occasioned by State action namely the amendment to Finance Act, 1994 w.e.f. 01.07.2012, which obviously is post conclusion of contracts in question. Any other answer or view would strike at reason, at law and at logic.
Conclusion - i) The arbitration clause did not preclude the exercise of writ jurisdiction in this case, given the nature of the dispute and the status of the respondent as an Article 12-Entity. ii) The Railways are liable to reimburse the service tax component to the appellant, with interest, due to the change in the legal regime post-contract. iii) New tax liabilities arising from state action should be borne by the service recipient, drawing an analogy to Section 64A of the Sale of Goods Act, 1930. iv) A Writ of Mandamus issues directing the respondent-South Western Railway to reimburse to the appellant all that amount which it has paid by way of service tax, with 9% interest p.a. from the date the amount became payable, within eight weeks.
The impugned order of the learned Single Judge is set aside - appeal allowed.
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2025 (3) TMI 848
Process amounting to manufacture - activity of chilling of milk would fall under ‘services’ as defined under Section 65B(44) or would fall under the negative list as per Section 66D(d)(iii) as claimed by the appellant? - HELD THAT:- Clause (d) of section 66D provides for services relating to ‘agriculture’ or ‘agricultural produce’. The appellant is therefore required to satisfy that the activity of chilling of milk falls within the category of ‘agriculture’ or ‘agriculture produce’, which has not been substantiated with reference to the provisions of the Finance Act. In terms of the definition of ‘agriculture’ and ‘agricultural produce’, chilling of milk is not covered. The conjoint reading of the aforesaid provisions clearly shows that the activities enshrined in the negative list are only related to agricultural activities and cannot embrace within it the activity of chilling milk.
The term ‘animal husbandry’ as per the meaning ascribed to it in the Cambridge Dictionary is, “farming of animal to produce foods such as meat, eggs and milk.” The term ‘animal husbandry’ being of wider import would include chilling of milk and therefore, the Gujarat High Court has rightly held the activity of chilling of milk to be exempted. However, there is no such provision in the Finance Act either in the negative list under section 66D(d)(iii) or under the definition of ‘agriculture’ and ‘agricultural produce’.
Conclusion - The activity of chilling of milk during the post negative period amounts to rendering ‘services’ as defined in section 65B (44) and is therefore, leviable to service tax.
There are no error in the impugned order and hence the same is affirmed. The appeal is, accordingly dismissed.
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2025 (3) TMI 847
Classification of services - Cargo Handling Services or Goods Transport Agency Service? - HELD THAT:- It appears that loading, unloading and packing or unpacking of cargo including freight special container. The main emphasis is on the ‘cargo’ and not ‘transportation’. The decisions cited by the learned counsel for the appellant also lays stress on the main activity to classify the service under CHS or under GTA, however if the loading or unloading in the truck is a part and parcel of the Transportation of Goods Services it is an incidental/ancillary activity and the same is classifiable under GTA. In the case Dalveer Singh (supra), the Tribunal was concerned with the issue whether the activity undertaken by the appellant, i.e. transportation of material from railway station to the warehouse is covered under CHS or not. Relying on the Board’s Circular dated 01.08.2002 clarifying that mere transportation of goods is excluded from the purview of CHS, allowed the appeal in favour of the assessee.
In the case of Hira Industries Ltd. [2012 (4) TMI 430 - CESTAT, NEW DELHI], the learned Members observed that when there is composite service which has elements fitting into the definition of both the services, recourse should be taken to Section 65A(2)(v) providing the test of most specific description to be adopted. In light thereof, it was held that transportation is not for the purpose of loading and unloading but the contrary is true i.e. loading and unloading is for transportation and therefore any person dealing with the situation perceives the services as one for transport and not for loading and unloading. Later in the case of Bhadoria Transport Co. [2014 (3) TMI 304 - CESTAT KOLKATA], the Tribunal considered the Board’s Circular dated 06.08.2008 clarifying that transportation is not the essential character of CHS but only incidental to the CHS and in that even the services shall be treated as GTA services and not CHS.
Conclusion - The main activity which the appellant performed was of transportation of goods which is classifiable under the GTA as defined under Section 65B(26) and the activity of loading and unloading the goods is only ancillary.
The impugned order is therefore set aside. The appeal is accordingly allowed.
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2025 (3) TMI 846
Eligibility of benefit of N/N. 41/2016 dated 22.09.2016 - whether the respondent is eligible for claiming the benefit of N/N. 41/2016 dated 22.09.2016. Government of Kerala had entered into an agreement dated 23.02.2011 with Smart City (Kochi) Infrastructure Pvt. Ltd. to lease-out two pieces of land for consideration of Rs.104 Crores? - HELD THAT:- It is an admitted fact that the lease deed was executed for entering into a Special Purpose Vehicle under Smart City (Kochi) Infrastructure Pvt. Ltd. and it is also an accepted fact that the said area is declared as SEZ. The fact being so, the service tax demand for the above said lease deed considering it as not covered under the Notification No.41/2016 dated 22.9.2016 is unsustainable.
It was also brought to the notice of the appellant that the levy of tax was not in force at the time of entering in to lease agreements as the old lease agreements were entered on November 17, 2007 and July 29, 2008 and the total lease premium was paid by SCIPL at that time but due to certain technical reasons these two lease deeds were cancelled on February 23, 2011 and the lease premium received for the old lease agreements were adjusted in the new lease agreements and that at the time of the old lease agreement, there was no levy of service tax on renting of vacant land. It was also stated that as service tax was payable only on receipt of payment, the payment that was received at the time of the two old lease agreements could not be taxed at the time of entering of the two new lease agreements.
Conclusion - The lease agreement falls within the exemption provided by Notification No.41/2016.
The impugned order is upheld and the appeal filed by the Revenue is dismissed.
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2025 (3) TMI 845
Liability of service tax - construction services rendered under various work orders, which involved supply of materials as well as labour by appellant - HELD THAT:- The construction works undertaken was in the nature of ‘Works Contract Service’, since it involves both supply of material as well as labour. Also, it is found that the appellant are registered with Kerala VAT Act, 2003 for discharging VAT on works contract service annexed to appeal paper book.
The Works Contract Service became taxable w.e.f. 01.06.2007 as held by the Hon'ble Supreme Court in the case of Larsen & Toubro Ltd. [2015 (8) TMI 749 - SUPREME COURT] and in the said case, it has been held that prior to 01.06.2007, works contract service cannot be subjected to service tax levy by vivisecting the composite service contract, which includes both goods and service.
Conclusion - The works contract services involving both goods and services cannot be taxed by dissecting the composite contract prior to June 1, 2007.
The impugned order is set aside and the appeal is allowed.
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2025 (3) TMI 844
100% Software EOU - CENVAT Credit of the accumulated crredit - Management of Business Consultancy Service - Management, Maintenance and Repair Service - Information Technology Software Service (ITSS) (June 2008 onwards) - Management Consultancy Service (June 2008 onwards) - reverse charge mechanism in terms of Section 66A of the Finance Act, 1994 in respect of the services received from M/s. Texas Instruments Inc., USA - Extended period of limitation - HELD THAT:- Undisputed facts are that the appellant is a 100% EOU registered under the STPI scheme and during the relevant period, pursuant to the agreement entered into with the overseas companies viz. M/s. Texas Instruments Inc., USA and M/s. Texas Instruments, Singapore, they have exported software services and rendered services to the overseas companies. Since there was no clearance to the domestic market and entire services were exported, the appellant had filed cash refund claims of accumulated cenvat credit of Rs.14,06,03,251/- on quarterly basis during the period April 2007 to May 2008. Under Rule 5 of Cenvat Credit Rules, 2004 Initially the said refund claims were rejected on the ground that the output services provided by them became taxable only w.e.f. 16.05.2008; hence the cenvat credit availed itself is inadmissible.
The matter has reached this Tribunal and this Tribunal following the ratio laid down in the case of mPortal India Wireless Solutions [2011 (9) TMI 450 - KARNATAKA HIGH COURT], remanded the matter to the adjudicating authority for de novo consideration. In the de novo proceeding, the adjudicating authority allowed the cash refund claims for the period April 2007 to May 2008.
Conclusion - The rejection of refund claims on the basis of non-taxability of output services is unsustainable when subsequent legal and administrative actions have sanctioned such claims.
The impugned order is set aside and the appeal is allowed with consequential relief, if any, as per law.
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2025 (3) TMI 843
Rejection of refund claim on the ground of being time barred - refund being filed beyond a period of one year from the date of payment of service tax - appellant has not filed any ST-3 returns nor even with the impugned claim - principles of unjust enrichment.
Principles of unjust enrichment - HELD THAT:- It becomes clear that the amount in question does not relates to service tax liability of the appellant but got collected erroneously as representing service tax. Such amount should be refunded even without application of the provisions relating to unjust enrichment. Support drawn from the decision of the principal bench of this tribunal in the case of Hexacom Vs. Commissioner of Central Excise, Jaipur [2003 (6) TMI 2 - CESTAT, NEW DELHI]. It is also observed that the amount in question since was deposited on 31.03.2009 towards the sale of SIM cards of financial year 2008-09, the tax was paid after the said activity of sale hence the issue of unjust enrichment of appellant does not otherwise arise.
Rejection of refund claim on the ground of being time barred - HELD THAT:- Section 11B of Central Excise Act, 1944 read with section 83 of Finance Act, 1994 makes it abundantly clear that if the refund claim is filed pursuant to a judgement / order, the period of one year to file refund claim shall start from the date of said judgement / order. As already observed above that the Order-in-Original dated 22-07.2021 has dropped the service tax demand holding no service tax liability of the appellant, the refund claim filed on 24.09.2021 is therefore well within one year of the period of limitation as prescribed under section 11B of Central Excise Act, 1944, explanation B(ec), read with section 84 of Finance Act 1994. In the light of this discussion, it is held that the adjudicating authority below has erred in ignoring the earlier order passed by the department in favor of the present appellant.
Lack of evidence as a ground of rejection of present refund claim - HELD THAT:- The authorities below have opined that due to non-availability of ST-3 returns, it cannot be confirmed that the amount as deposited by the appellant was meant for providing the services for which the demand was dropped vide order dated 22.07.2021. However, it has been settled that the activity of sale of SIM cards does not invite any service tax liability on the amount of commission / incentive received for rendering such activity. The question of any service tax liability and filing of ST-3 returns become redundant. The appellant apparently was not registered earlier with the service tax department. It was only when department asked the appellant to get registration and to deposit service tax that the appellant took registration at the end of financial year 2008-09 and deposited the proposed amount for the said financial year. The impugned show cause notice proposed the demand for the period including 2008-09 to financial year 2011-12. Hence, this ground of rejection of impunged refund claimed is factually incorrect.
Conclusion - i) The refund claim is not time-barred as it is filed within one year of the Order-in-Original that nullified the service tax demand. ii) The appellant is not unjustly enriched, and the refund should be granted. iii) The lack of ST-3 returns does not invalidate the refund claim, as the service tax demand for the relevant period was already dropped.
Appeal allowed.
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2025 (3) TMI 842
Levy of Service Tax on the appellant share in the Central Rights Income, CLT20 Participation Fees and prize money received from BCCI-IPL in organizing the IPL tournament under 'Business Support Services (BSS) - Levy of Service Tax on Support Services of Business provided by overseas cricket professionals under reverse change mechanism for wearing apparel, taking part in endorsements and other activities under Business Support Services (BSS) - Levy of Service Tax on player release fees paid to Cricket Australia under reverse charge mechanism under manpower Recruitment or Supply Agency Services - Levy of Service Tax on player transfer fee received from other franchisees under Manpower Recruitment or Supply Agency Services - time limitation
Levy of Service Tax on the appellant share in the Central Rights Income, CLT20 Participation Fees and prize money received from BCCI-IPL in organizing the IPL tournament under 'Business Support Services (BSS) - HELD THAT:- This Tribunal in the case of KNIGHT RIDERS SPORTS PVT. LTD. VERSUS ASSISTANT COMMISSIONER OF INCOME TAX CENTRAL CIRCLE – 4 (2) MUMBAI, CHIEF COMMISSIONER OF INCOME-TAX (CENTRAL) – 2 MUMBAI, THE UNION OF INDIA [2023 (6) TMI 1161 - CESTAT MUMBAI] held that 'In the present case, since the demand of Rs. 16,71,71,797/- in respect of Central Rights Income arising out of the franchise agreement cannot be considered as provision of any service between the members to the franchise agreement, we are of the view that such demand cannot be confirmed on the assessee-appellants.' - The demand for service tax on this income was set aside.
Levy of Service Tax on Support Services of Business provided by overseas cricket professionals under reverse change mechanism for wearing apparel, taking part in endorsements and other activities under Business Support Services (BSS) - HELD THAT:- The Tribunal in Kinight Rider Sports Private Limited [2023 (6) TMI 1161 - CESTAT MUMBAI] held 'the said issue has already been dealt with by the Co-ordinate Bench of this Tribunal, in the case of Sourav Ganguly v. Commissioner of Service Tax, Kolkata (Now Commissioner of Central Goods & Service Tax & Central Excise, Kolkata South), [2020 (12) TMI 534 - CESTAT KOLKATA], wherein it was held that the view taken by the commissioner is not correct as the players had received the fees for the purpose of playing cricket only and even otherwise, it is a settled principle of law that if no machinery provision exists to exclude non-taxable service (playing cricket) from a composite contract, the same is not taxable since law must provide a measure or value of the rate to be applied and any vagueness in the legislative scheme makes the levy fatal. Thus, the Tribunal held in this case that the confirmation of demand could not be sustained.' - the demand is set aside.
Levy of Service Tax on player release fees paid to Cricket Australia under reverse charge mechanism under manpower Recruitment or Supply Agency Services - HELD THAT:- The core requirement that the service which is provided or to be provided, must be by a manpower recruitment or supply agency has been missed. Moreover, such a service has to be in relation to the supply of manpower. The appellant paid player release fees to CrKPH DREAM CRICKET PVT. LTD. VERSUS CCE & ST, CHANDIGARH-I (VICE-VERSA) [2019 (5) TMI 1171 - CESTAT CHANDIGARH] held that 'neither cricket board nor the appellant-assessee are engaged in providing Manpower Recruitment or Supply Agency Service of employees. Therefore, no service tax is payable by the appellant-assessee.' - the demand is set aside.
Levy of Service Tax on player transfer fee received from other franchisees under Manpower Recruitment or Supply Agency Services - HELD THAT:- The issue is no more res-integra as the Tribunal in KPH Dream Cricket held that 'As the main activity of the appellant-assessee to play cricket, therefore, no service tax is payable by the appellant-assessee under the category of 'Manpower Recruitment or Supply Agency service' for transfer of player fee.'
Time limitation - HELD THAT:- A Perusal of the facts reveal that the appellant had disclosed all relevant facts and Department was well aware of the receipts, on which the appellant was not paying service tax and reasons for the same. Therefore, the averments and findings that department became aware because of audit or that the Appellant suppressed any facts is incorrect. Consequently, we hold that the demand is also barred by limitation.
Conclusion - i) The income from Central Rights under a franchise agreement does not constitute Business Support Services. ii) Payments to players for promotional activities, when primarily engaged for playing cricket, are not taxable under Business Support Services. iii) Player release fees to cricket boards and player transfer fees are not taxable under Manpower Recruitment or Supply Agency Services. iv) The demand for service tax was barred by limitation due to the department's prior knowledge of the appellant's transactions.
Appeal allowed.
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2025 (3) TMI 782
Recovery of service tax with interest and penalty - difference in figures of P & L A/c and ST-3 returns - whether the Appellant has correctly disclosed the value of taxable services in ST-3 returns? - levy of late fees and penalties u/s 78, 77(1)(c), 77(1)(d) & 77(2) of FA.
Demand of service tax of Rs 5,98,38,654/- based on difference in figures of P & L A/c and ST-3 returns and whether the Appellant has correctly disclosed the value of taxable services in ST-3 returns - HELD THAT:- A perusal of the two invoices reproduced in the impugned order also shows that the Appellant has separately charged for advertisement services and sale of goods along with service tax and VAT on respective components of invoices. The consideration for the two being identified and charged separately, the contract is clearly a composite contract for providing advertisement services and sale of goods and not an indivisible contract, which is also accepted in paragraph 16.6 of the impugned order. Therefore, the Appellant has rightly paid service tax and VAT on respective components, which is in consonance with the law laid down in Imagic Creative (P) Ltd. v. CCT [2008 (1) TMI 2 - SUPREME COURT] where while considering the composite contract relating to advertisement services, the Hon’ble Supreme Court held 'Payments of service tax as also VAT are mutually exclusive. Therefore, they should be held to be applicable having regard to the respective parameters of service tax and the sales tax as envisaged in a composite contract as contradistinguished from an indivisible contract. It may consist of different elements providing for attracting different nature of levy. It is, therefore, difficult to hold that in a case of this nature, sales tax would be payable on the value of the entire contract, irrespective of the element of service provided. The approach of the assessing authority, to us, thus, appears to be correct.'
Once the amounts representing sale of goods i.e. Rs 13,35,68,175/- and amounts representing value of services falling under negative list i.e. Rs 30,42,96,081/- are adjusted and deduction in terms of Circular No. 341/43/96 dated 31.10.1996 is applied which has also been allowed in the impugned order, there is no difference in figures appearing in Balance Sheet and ST-3 returns and therefore, the demand of service tax of Rs. 5,94,38,654/- cannot be sustained.
Denial of cenvat credit of Rs 97,36,884/- is sustainable on the grounds stated in the impugned order - HELD THAT:- The impugned order does not dispute the explanation that the Appellant has taken space on lease from institutions including Lucknow Golf Club, India Industries Association and others for installation of bill boards, LED signage etc. and used such space for providing advertisement services through such bill boards, LED signage etc.. This activity of taking space on lease is clearly an input service used for providing output service and therefore the Appellant is entitled to credit of service tax charged on lease rentals and hence credit cannot be denied on this ground.
The last allegation of non-submission of invoices also does not survive, as the order records that the invoices were subsequently produced by the Appellant, which were verified and after verification credit of only Rs 97,36,884/- has been denied, the merits of which has already been discussed in this order. Thus, the denial of credit in the present case is not warranted.
Whether late fees can be demanded and penalties u/s 78, 77(1)(c), 77(1)(d) & 77(2) can be imposed? - HELD THAT:- The show cause notice proposed imposition of penalty u/s 77 (1)(c) for failure to furnish information, u/s 77(1)(d) for failure to pay tax electronically and Section 77(2) for contravention of the provisions, without alleging anything as to when and what information was not furnished by the Appellant, when and what amount of tax was not paid electronically and which provisions have been contravened by the Appellant. It is a settled law that show cause notice is the foundation of the case set up by the Revenue and once the show cause notice lacks necessary particulars, it is difficult to uphold imposition of penalties under these provisions.
As regards late fee, the demand of late fee has been confirmed under Section 70 read with Rule 7(C) on the ground that the Appellant has not averred anything in the defence reply or at the time of personal hearing. This finding appears to be perverse and contrary to record, as in paragraph 8 of reply dated 13.02.2020, the Appellant has clearly stated that delay in submission of ST-3 return was on account of delayed collection of dues and the Appellant has filed the service tax returns by paying tax from his own pocket. The delayed submission of return on account of delayed collection of tax and payment of service tax from own pocket, which otherwise is to be charged and deposited, is a reasonable ground for belated submission of ST-3 returns and therefore the late fee imposed cannot be sustained.
Conclusion - i) The demand of service tax and denial of CENVAT credit were not sustainable. ii) Once the amounts representing the sale of goods and services under the negative list were adjusted, there was no discrepancy between the Balance Sheet and ST-3 returns, rendering the service tax demand unsustainable. iii) The denial of credit was unwarranted, as the Appellant had demonstrated compliance with relevant provisions and maintained proper accounts. iv) Imposition of penalties are upheld. Late fees not sustained.
The appeal is liable to be allowed and the impugned order, to the extent challenged, is set-aside, with consequential reliefs to the Appellant.
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2025 (3) TMI 781
Recovery of service tax with interest and penalty - Original Authority has determined the tax due from the appellant to be less than the amount claimed to be payable by the appellant as per the calculation chart submitted by the appellant, and paid by them - non application of the mind by the adjudicating authority - violation of principles of natural justice - HELD THAT:- From the computation made by the appellant and submitted before the original authority, it is evident that after claiming all the deductions, they admit that the service tax short paid by them was Rs 4,30,056.00/-.
Both the authorities below have misdirected themselves as there was no contest by the appellant to the invocation of the extended period or the demand of service tax. Appellant has suo motto computed the service tax due. He made the submission to this effect before the original authority and also before the appellate authority. He also pleaded his lack of knowledge and status as petty contractor not having means to understand the complexity of taxation of services. Both the authority agreed to these submissions and have still gone on to impose penalties under Section 77 and 78 of the Finance Act, 1994.
Undisputedly appellant is a petty contractor whose total turnover during the entire period of dispute i.e. from 16.06.2005 to 31.03.2010 was meager Rs 1,13,39,820/-. Taking note of undisputed findings with regards to status of appellant and his compliance/ intention to comply even before the adjudication/ appellate proceeding has been concluded there are no justification for not having considered extending the benefit of Section 80 of the Finance Act, 1994 and waiving of all the penalties imposable on the appellant.
There are no merits in the impugned order to the extent it is in relation to the penalties imposed on the appellant. This is a fit case where penalties imposable under Section 77 and 78 should have been waived in terms of provisions of Section 80 of the Finance Act, 1994.
Conclusion - i) The demand for service tax, as quantified by the adjudicating authority, is confirmed, but the penalties imposed are set aside. ii) There are no merit in the imposition of penalties, considering the appellant's status and compliance efforts.
Appeal allowed in part.
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2025 (3) TMI 780
Levy of Brand Endorsement charges received by the appellant under the guise of Business Auxiliary Charges/Brand Promotion Charges - Levy of service tax on IPL Playing Fee attributing the same as rendering of Business Support Service - time limitation.
Levy of Brand Endorsement charges received by the appellant under the guise of Business Auxiliary Charges/Brand Promotion Charges - HELD THAT:- The fact of appellant having discharged tax on amounts directly received by him as aforestated is not disputed by the Revenue. In this regard the appellant has also taken us through the certified statement copies enclosed as part of the paper book, of Rithi Sports Management Pvt. Ltd. and the various schedules pertaining to Mindscapes Maestros, DB Corp. ltd. Lafarge India, Nutrine Confectionery Company, Dabur, Aircel, Parle Products Pvt. Ltd. NDTV, MAXX and Purple People Entertainment Pvt. Ltd, who acted as agents of the appellant - The impact analysis of this difference ought to have been taken note of by the authorities while working out the demand and as ascertained from the balance sheet, the figures pertaining to the debtors.
It is also noted that a fairly large amount of tax that was paid by the appellant’s agents on his behalf and as presented in Annexure XI of the paper book (incidentally this is a communication of the department dated 30/10/2013), were not taken note of by the lower authority, though, these details were well available with the adjudicating authority at the time of adjudication. In Qui Facit Per Alium Facit Per Se, a common legal principle to state that one who acts through another actually acts himself, there remains no doubt that tax as discharged by the various agents would need to be taken note of, for arriving at the total tax liability, if any on the appellant. As elaborately explained, that tax was duly discharged either by the appellant himself or on his behalf by the agent, the demand raised towards Brand Endorsement does not survive and is required to be quashed.
Levy of service tax on IPL Playing Fee attributing the same as rendering of Business Support Service - HELD THAT:- It has been placed on record that tax due thereon was admitted and paid and was so indicated in their rejoinder reply dt. 2.1.2012, whereby the appellant self-assessed to tax on the said service as Brand Promotion Service and thereafter paid the tax @ 10% of the value of Playing Fees vide challans dt. 31.01.2012 & 13.2.2012 along with interest as applicable. It is noted that this amount does not find a mention as having been appropriated in the impugned order. Upon a query from the Bench, the ld. CA for the appellant undertakes not to claim refund of the said amount paid. In view of the fact that the total demand on this count of Rs. 14,96,402 (Ist SCN-1,16,300, IInd SCN- 12,80,102/-) stands paid along with interest, there is no merit in sustaining the same. Likewise, for the IInd SCN, it is noted that the appellant having admitted his liability to tax under BPS for the amount directly received by him and having paid the same vide challan dated 22.12.11 alongwith interest, the said demand would no more survive. It is also clarified from records that the demand of Rs. 12,80,102/- as worked out by the revenue was inclusive of Match Winning Bonus. This amount has no bearing with rendering of service and needs to be excluded. Accordingly, tax @ 10% of Player Fee of Rs. 11.50 Cr, exclusive of Bonus is leviable to tax which as per challans as indicated above stands discharged. Thus no liability survives on this count as well.
Time limitation - HELD THAT:- There are no basis to sustain this charge of the revenue. It is settled law that to invoke these ingredients, it is for the authorities to indicate specifics to prove their case. In the absence of no such evidence forthcoming, any allegation invoking such strong and harsh measures regarding fraud, suppression, misdeclaration is clearly unsustainable and there appears no intent on part of the appellant to evade payment of duty, who has himself paid tax as due along with interest. Under the circumstances, no case is made out in the matter to sustain the said allegations and the same is dismissed.
Conclusion - i) The appellant was not liable for service tax under the categories of "Business Auxiliary Service" and "Brand Promotion Service" for the periods in question. ii) There are no evidence of suppression or willful misstatement by the appellant, and therefore, the invocation of the extended period of limitation was not justified. iii) The penalties imposed under Sections 76, 77, and 78 of the Finance Act were set aside as unjustified.
Appeal allowed.
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2025 (3) TMI 745
Liability of appellant to pay tax on the amount paid or remitted to the foreign based service provider under the Banking and Financial services on Reverse Charge Mechanism [RCM] basis - place of provision of services - Mega Exemption Notification No. 25/2012 dated 20th June 2012 - demand of interest and penalties.
HELD THAT:- The present show cause notice is 4th in line. It has been brought to our notice that the SCN dated 21.01.2013 has been decided vide order in original No. 17/2013 dated 29.03.2014 wherein the Assistant Commissioner had dropped the demand in respect of ‘Business Exhibition Service’ received from the foreign service providers located outside the taxable territory holding that Notification No. 5/2011 dated 01.06.2011 exempts the taxable services specified in sub clause (zzo) of clause (105) of Section 65 of the said Finance Act, when provided by an organizer of Business Exhibition for holding a business exhibition outside India, from the whole of the service tax leviable thereon under Section 66 of the said Act. The impugned order has absolutely ignored the said decision. It has been the settled law that once an order has been passed allowing full relief to the assessee then it would not be proper for the department to take a different view on same issue provided there are no factual difference in two situations.
The Hon’ble Apex Court in Vishnu Traders [1993 (11) TMI 230 - SUPREME COURT] has held 'In the matters of interlocutory orders, principle of binding precedents cannot be said to apply. However, the need for consistency of approach and uniformity in the exercise of judicial discretion respecting similar causes and the desirability to eliminate occasions for grievances of discriminatory treatment requires that all similar matters should receive similar treatment except when factual differences require a different treatment so that there is assurance of consistency, uniformity, predictability and certainty of judicial approach.'
Coming to the submission vis-à-vis invalidity of the show cause notice demanding service tax under the omitted provisions, we observe that the impugned show cause notice has been issued after the amendment in Finance Act with effect from 01.07.2012. The said amendment as per Notification No. 19/2012 dated 05.06.2012 has made the erstwhile section i.e. Section 66 of Finance Act 1994 as inoperative with effect from 01.07.2012 and Section 66B is incorporated as the new charging section of the service tax. The impugned show cause notice has demanded service tax under the erstwhile Section 66 of the Finance Act. The show cause notice is apparently invalid otherwise also as per newly incorporated Section 66B. The service tax with effect from 1.7.2012, is leviable on all services except those specified in the negative list of the services.
It is the appellant’s case which is not anywhere disputed nor denied, that the services were received for conducting Business Exhibitions that too abroad i.e. the exhibitions were conducted outside the taxable territory. Hence had the right provisions would have been invoked at the time of issuance of show cause notice, there was no necessity for the issuance. The show cause notice issued under inoperative erstwhile provision is not sustainable.
Place of Provision of Services - HELD THAT:- The Place of Provisions for holding any exhibition/events shall be the place where the event is held. The department’s own Educational Guide dated 20.06.2012 has also clarified that the event held outside taxable territory is not covered under Finance Act, 1994. It is an undisputed fact of the present appeal that the Business Exhibition for which the appellant received services from the foreign agencies, were held outside the taxable territory. Resultantly, the Place of Provision of Services received by the appellant from the foreign service provider shall be outside the territory of India. Accordingly, appellant is not liable to pay service tax even under RCM.
Mega Exemption Notification No. 25/2012 dated 20th June 2012 - HELD THAT:- The adjudicating authorities have miserably ignored the exemption notifications. From Section 66B also there is the tax liability for all services being not covered in the negative list. However, section itself clarifies any service shall not be liable to tax if same falls under any of the exemption notification. Hence the demand of service tax has wrongly been confirmed.
Imposition of penalty and demand of interest - HELD THAT:- Since the service tax itself is not payable the question of charging any interest under provision of Section 75 of the Act does not at all arises - it is observed that it has been defence of the appellant, since beginning, that the appellant has bona fide belief that it is not liable to pay service tax even under reverse charge on the payment made to the foreign service provider. The said bona fide belief is held to be a reasonable cause for not discharging depositing the service tax. Resultantly, the appellant is held entitled for the benefit of Section 80 of the Finance Act, 1994. Support drawn from the decision of this Tribunal in Mumbai Bench in the case of Commissioner of Service Tax, Mumbai Vs. Gama Consultancy Pvt. Ltd. [2006 (8) TMI 32 - CESTAT, MUMBAI]. Accordingly, the penalty is also wrongly imposed upon the appellant.
Conclusion - i) The place of provision rules dictate tax liability and that exemptions must be considered. ii) The show cause notice is invalid. iii) The appellant was not liable for service tax under RCM for exhibitions held abroad; exemptions applied. iv) Penalties and interest are unwarranted.
Appeal allowed.
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2025 (3) TMI 744
Levy of service tax on the one-time premium collected for the renting of immovable property - applicability of renting of shops, specifically considering the threshold exemption limit under the relevant notifications.
HELD THAT:- The issue is squarely covered by the decision of Hon'ble Allahabad High Court in the case of M/s Greater Noida Industrial Development Authority, Noida [2015 (4) TMI 1231 - ALLAHABAD HIGH COURT] wherein it was held that 'Letting of immovable property for consideration, which is determined on the basis of offers received from public at large by the assessee Greater Noida Industrial Development Authority is a service provided for consideration and not on payment of statutory fees, neither it is a statutory service performed by the assessee. It may be that the statute permits such activities of letting out of immovable property for augmenting its finances but the same cannot be termed as the service in public interest nor it is a mandatory or statutory functions of the Development Authority. Accordingly such activity of leasing do constitute a taxable service, in our opinion.'
As there are no merits in the submissions made by the appellant in respect of the levy of service tax on the “one time premium” or “salami” collected by them, the value of taxable services provided during each financial year for the period in the dispute would be more than the threshold exemption limit as provided by the Notification No 4/2007-ST dated 01.03.2007 as amended from time to time.
Conclusion - Both the one-time premium and the rent are subject to service tax under the renting of immovable property, and the exemption limit applies to the combined total of these amounts.
There are no merits in the appeal - appeal dismissed.
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2025 (3) TMI 743
Rate of Interest on Refund - Rejection of appellant’s prayer for higher rate of interest of 12% instead of the notified rate of 6% for deposits under section 35FF - nature of the amount deposited by the appellant during investigation towards service tax, which was appropriated by the adjudicating authority towards confirmed demand of service tax - interest on refund of the above amount as prescribed under section 11 BB under section 35FF of the Central Excise Act, 1944 as made applicable to Service Tax by virtue of section 80 of the Finance Act, 1994.
How should an amount which has been deposited as service tax, but which subsequently became refundable, consequent upon an order of the tribunal or courts be treated. Will it be a service tax, pre-deposit or just a revenue deposit? - HELD THAT:- There are no separate provisions for refund of service tax under Chapter V of the Finance act 1994 [Finance Act]. The provisions of sections 11B, 11BB, 35F, 35FF have been made applicable to service tax by section 83 of the Finance act, 1994. Section 11B deals with refund of excise duty and when applied to service tax, it deals with refund of service tax. Section 11BB deals with interest on refund under section 11B - vidently, section 11B covers situations where the duty becomes refundable as a consequence of an order or judgment by the Tribunal or any Court which is precisely the case here. The submission of the appellant is that what it had paid was not duty at all because no duty was payable. To examine this submission, what needs to be examined what is the situation under which a duty becomes refundable. If the amount which is paid as duty is due, it will not be refundable at all. If it is not payable as duty, then it becomes refundable under section 11B.
Who and what factors will determine if the amount paid as duty was payable or not? - HELD THAT:- This question was dealt with at length by the larger bench of the Supreme Court in ITC LTD. Vs. Commissioner Of Central Excise, Kolkata-Iv [2019 (9) TMI 802 - SUPREME COURT (LB)]. In this judgment, the Supreme Court dealt with a batch of appeals dealing with the question as to whether refund can be sanctioned so as to modify the assessment including self-assessment. The Supreme Court held that refund proceedings are in the nature of execution proceedings and refund cannot be sanctioned so as to modify the assessment including self-assessment. The person seeking modification of the assessment has to assail it in an appeal and refund can be sanctioned only after the assessment is modified.
In this case, the SCN issued by the department proposing demand of service tax effectively modifying the assessment. This proposal was confirmed by the lower authorities. The amounts paid by the appellant during investigation were appropriated towards the service tax. Had there been no appeal or further orders by this Tribunal, the amount paid by the appellant would have been Service tax.
The distinction between refund of pre-deposit made under section 35F and duty or service tax paid under section 11B is that the pre-deposit under section 35F can be a percentage of duty, fine or penalty. It must be deposited as a pre-condition for filing an appeal. If the pre-deposit is not made, there will be no right of appeal to the person aggrieved by the order. Section 11B, on the other hand, provides for refund of duty or service tax. If an amount is already paid as duty or service tax, it is reckoned while computing if any further amount needs to be paid to meet the mandatory requirement of pre-deposit under section 35F. Merely because such adjustment is made, the amount paid as service tax or fine or penalty does not become pre-deposit under section 35F.
Conclusion - What was paid by the appellant was service tax as determined by the lower authorities in the adjudication proceedings. If there was no further order, nothing would have been refundable. However, the order of the adjudicating authority was modified by this Tribunal setting aside the demand. Therefore, the service tax became refundable as per section 11B and the relevant date for the purpose was the date of the order of the Tribunal. If there was any delay in sanctioning of the refund, interest must be paid as per section 11BB.
Matter remanded to the Assistant Commissioner to examine and sanction refund under section 11B along with interest under section 11BB. It is made clear that the appellant had already made an application in the form of a letter which was processed and no new application is required. Only the amount of interest may be recalculated as per section 11BB instead of as per section 35FF.
The impugned order is set aside and the matter is remanded to the Assistant Commissioner.
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2025 (3) TMI 742
Failure to pay the appropriate service tax on “Erection, Commissioning and Installation Service” and “Works Contract Service” under Reverse Charge Mechanism as per the applicable provisions while providing transmission services as per Electricity Act, 2003 - demand for interest on Cenvat credit reversed by the appellant - invocation of Extended period of limitation - HELD THAT:- It is found that consistently this Bench has held that the appellant are entitled to benefit sought of tax being exempted. The matter is squarely covered with adverse decision to the revenue of this Tribunal as on date. In this regard, para 7 & 9 of the decision in GUJARAT ENERGY TRANSMISSION CORPORATION LIMITED VERSUS COMMISSIONER OF CENTRAL EXCISE & ST, ANAND [2024 (2) TMI 1401 - CESTAT AHMEDABAD] where it was held that 'the entire period in the present appeal i.e. related to Notification No. 45/2010-ST, 11/2010-ST and also for the period when negative list under Section 66D was in force, it was held that service for transmission of electricity is not leviable to service tax. Therefore, the issue is no longer res-integra.'
Conclusion - i) The services related to the transmission of electricity are exempt from service tax. ii) The demand for interest for the longer period would not sustain.
Appeal allowed.
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