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TMI Blog2016 (2) TMI 656X X X X Extracts X X X X X X X X Extracts X X X X ..... heir executives is, admittedly, remuneration for the efforts made by the employees of the appellant to promote the products of the finance companies. Admittedly, they are employees of the appellant and, thereby, not free agents. Their promotional efforts cannot be delinked from that of the appellant; the fact that payments are made over to the appellant is sufficient to deduce so. That the appellant chooses not to retain any of the commission and instead passes them on to the executives is an internal policy of the appellant that need not concern the tax authority. Processing fees are the consideration for handling the loan applications and it is, undoubtedly, incidental to promotion of the service that is offered by the finance companies. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Vide the impugned order 133/CE/CHAND-I/2010 dated 10th September 2010, the first appellate authority reduced the total demand to ₹ 10,04,929/- (inclusive of the wrongly availed CENVAT credit) with interest thereon and, while upholding the imposition of penalty under section 76, reduced the penalty under section 78 to ₹ 10,04,929/-. The specific receipts that were held to be taxable were the commission or remuneration from finance companies (other than Maruti Finance who had discharged the tax liability) and insurance companies, as well as processing fees and incentives received by the executives of the appellant from finance companies. 3. Heard the rival submissions. Our attention was drawn to the decision of a Larger Bench ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eration for handling the loan applications and it is, undoubtedly, incidental to promotion of the service that is offered by the finance companies. Having made the claim that receipts on account of table space is not taxable and that claim having been accepted, it stands to reason, and within the coverage of the decision of this Tribunal in re Pagariya Auto Centre, that the dividing line between taxability and non-taxability lies in the nature of the transactions. The commission and processing fees can be inferred to be the remuneration for rendering services within the meaning of section 65(19) of Finance Act, 1994. 5. Accordingly, the impugned order is modified to the extent of setting aside the demand of ₹ 4,00,992/- on commis ..... X X X X Extracts X X X X X X X X Extracts X X X X
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