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2024 (5) TMI 327 - CESTAT NEW DELHILevy of service tax - act of providing ‘corporate guarantee’ to the respondent for grant of loan from the banks without any consideration - HELD THAT:- There has been a consistent finding in all the decisions that the party had provided corporate guarantee on behalf of its sister concern to its lenders, who had not charged any commission or fee for providing guarantee and hence such activity is not chargeable to service tax. The observations made by this Tribunal in the latest decision in M/s.Pharmax Corporation Ltd. [2024 (3) TMI 1179 - CESTAT NEW DELHI] where it was held that 'The service provider shall be liable to pay service tax on the consideration which it receives for providing a taxable service. Any amount which is received but which is not a consideration for providing a taxable service is not exigible to service tax. Similarly, if a service is rendered, but no consideration is received no service tax can be charged. It is for the reason that if the consideration received is zero any percentage will be zero itself.' In the present case, it is found from the show cause notice, order-in-original and the impugned order that no consideration has been paid by the respondent in lieu of the corporate guarantee and in view of the judicial pronouncements, there are no reason to distinguish the same in the facts of the given case. Consequently, no service tax is leviable on the respondent on account of ‘corporate guarantee’. The impugned order deserves to be upheld - appeal of Revenue dismissed.
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