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TMI Blog2016 (11) TMI 281X X X X Extracts X X X X X X X X Extracts X X X X ..... f the service can only be taken the value which is paid payable by the service recipient. In the present case also, the subsidy given by the government, since not a part of the amount paid by the service recipient to the service provider, the subsidy cannot be included in the gross value of service. Therefore, the ratio of the Hon’ble Supreme Court judgment is directly applicable to the present case. The subsidy amount will not attract service tax. The adjudicating authority is directed to re-quantify the service tax liability by reducing the amount of subsidy. Waiver of penalty - the appellant has shown reasonable cause for non payment of service tax. Therefore, they are entitled for the waiver of penalties imposed under Section 76 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lant have received transportation subsidy from Government for ₹ 7,43,625/-. The service tax should not have been demanded on this amount. In this regard, they placed reliance on the Hon ble Supreme Court judgment in the case of Commissioner of Central Excise, Bangalore Vs. Mazagon Dock Ltd. 2005 (187) E.L.T. 3 (S.C.). The appellant in respect of penalties under Section 76 78 made a submission that this differential tax liability arose due to arithmetical error therefore there is no intention to evade the service tax. The appellant placed reliance on the following judgments: (i) SGS India Pvt. Ltd. Vs. Commissioner of C.Ex. Thane-I 2012 (26) STR 359 (Tri.-Mumbai) (ii) Commissioner of C. Ex. Cus. Vs. Port Officer 2010 (91) STR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the buyer of the goods. Similarly, in the case of service the subsidy of transportation given by the Government is not paid by the service provider. The gross amount of the service can only be taken the value which is paid on payable by the service recipient. In the present case also, the subsidy given by the government, since not a part of the amount paid by the service recipient to the service provider, the subsidy cannot be included in the gross value of service. Therefore, the ratio of the Hon ble Supreme Court judgment is directly applicable to the present case. Accordingly, I hold that the subsidy amount will not attract service tax. The adjudicating authority is directed to re-quantify the service tax liability by reducing the amoun ..... X X X X Extracts X X X X X X X X Extracts X X X X
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