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2023 (10) TMI 678 - AT - Service TaxLevy of Service Tax - Business Auxiliary Service - incentive/commission received by the appellant from M/s.Galileo India Pvt. Ltd. for using CRS service - HELD THAT - The said issue has been settled by the Larger Bench of this Tribunal in the case of KAFILA HOSPITALITY TRAVELS PVT. LTD. VERSUS COMMISSIONER, SERVICE TAX, DELHI 2021 (3) TMI 773 - CESTAT NEW DELHI (LB) , which has been followed by this Tribunal in the case of M/S. ASVEEN AIR TRAVELS (P) LTD. VERSUS COMMISSIONER OF GST CENTRAL EXCISE, CHENNAI 2022 (4) TMI 1035 - CESTAT CHENNAI , wherein this Tribunal has observed the said incentive is not subject to levy of service tax. The issue is no more res integra in the light of the decision of the Larger Bench as well as followed by this Tribunal in the case of Asveen Air Travels (P) Ltd., it is held that the incentive/commission received by the appellant from M/s. Galileo India Pvt. Ltd. is not liable to service tax, in terms of section 65(19) of the Finance Act, 1994. The impugned order set aside - appeal allowed.
Issues involved:
The issue involved in this case is whether the incentive/commission received by the Appellant for using CRS service is subject to service tax or not. Comprehensive Details: 1. The Appellant, an Air Travel Agent, receives commission from the airline for selling airline tickets through a Computer Reservation System (CRS) provided by service providers like Amadeus, Galileo, and Wordspan. The CRS provider enters into agreements with the airline and the travel agent to facilitate reservations through a computer system. The Appellant entered into an agreement with Galileo India Pvt. Ltd., through Amex, to use their advanced computerized reservation system. The service tax department issued show cause notices to the Appellant, claiming that the incentive/commission received qualifies as 'Business Auxiliary Service' and is liable for service tax under section 65(19) of the Finance Act, 1994. 2. The Appellant argued that the issue has been settled by a Larger Bench decision in the case of Kafila Hospitality & Travels Pvt. Ltd., followed by this Tribunal in Asveen Air Travels (P) Ltd. The Appellant contended that the incentive/commission received is not subject to service tax based on the interpretation of relevant laws and precedents. 3. After hearing both parties, the Tribunal considered the submissions and referred to the decision of the Larger Bench in Kafila Hospitality & Travels Pvt. Ltd. The Tribunal observed that the incentive received by the Appellant for using the CRS service is not liable for service tax under section 65(19) of the Finance Act, 1994. The Tribunal set aside the impugned orders and allowed the appeals in favor of the Appellant. This summary provides a detailed overview of the legal judgment, highlighting the issues involved and the Tribunal's decision based on the interpretation of relevant laws and precedents.
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