Applicability of Service Tax on hire purchase transactions - Supreme Court uphold the decision of Tribunal differentiating between

Earlier in a matter of M/s BAJAJ AUTO FINANCE LTD Versus COMMISSIONER OF C. EX., PUNE reported in 2007 -TMI - 1546 - CESTAT,MUMBAI, honorable tribunal, after detailed discussions and findings, has held that:

"that hire purchase finance, in which the appellants are engaged, is different from hire purchase and that hire purchase finance is not covered under the provisions of Section 65(10) of Chapter V of the Finance Act, 1994, and accordingly the demand was dropped against the appellant."

Department preferred an appeal against the order of CESTAT before the Supreme Court. Honorable Apex Court in the matter of COMMISSIONER OF CENTRAL EXCISE Versus BAJAJ AUTO FINANCE LTD. reported in 2008 -TMI - 4186 - SUPREME COURT, upheld the decision of CESTAT.

Relevant provisions:

Section 65(10) of Chapter V of the Finance Act, 1994 (Service Tax) Banking and other financial services