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TMI Blog2017 (3) TMI 118X X X X Extracts X X X X X X X X Extracts X X X X ..... - penalty set aside. Reimbursible expenses - valuation - Held that: - the service tax liability on the amount paid as reimbursable to the professionals will not includable as gross value of services and not taxable under Rule 5(1) and also the Rule 7 of the Service Tax Valuation Rules which categorically rules out the reimbursable expenses. Appeal allowed - decided in favor of appellant. - ST/87508, 87509 and 87540/13 - A/85675-85677/17/STB - Dated:- 18-1-2017 - Mr. M.V. Ravindran, Member (Judicial) And Mr. C.J. Mathew, Member (Technical) Shri S.A. Gundecha, Advocate for assessee Shri B. Kumar Iyer Supdt. (AR) for Revenue ORDER Per M. V. Ravindran These three appeals are challenging the order-in-appeal No. P- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Service Tax (Determination of Value) Rules, 2006 (hereinafter referred to as STVR, 2006). 3.2 On being pointed out, the respondent discharged the service tax liability of ₹ 31,22,857/- along with interest of ₹ 3,03,360/- on the Business Support Services. However, they disputed the service tax liability of ₹ 15,37,327/-, in respect of dues pertaining to Consulting Engineering Services on account of non-consideration of Gross amount while calculating the taxable value. 4. Adjudicating authority confirmed the demand raised and appropriated the amount already deposited along with interest. By agreeing with the contentions of the assessee-appellant, the adjudicating authority did not confirm the demand of service tax lia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al reimbursable charges of various professionals of sister concern of assessee-appellant visiting India and is covered by the judgement of Hon'ble High Court of Delhi in the case of Intercontinental Consultants and Technocrats Pvt. Ltd. v. UOI 2013 (29) STR 9 (Del.). 6.1 Learned D.R. would submit that having paid an amount to the foreign national for the bank guarantee and LC charges, which was an activity which extended Corporate guarantee in order to raise the funds by the assessee-appellant, it is taxable under the category of 'Business Support Services' and having not discharged the service tax liability, penalties are correctly imposed. 6.2 As regards the department s appeal, the contention is that the said expens ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be a service rendered to the appellant as the banks extended loan facilities to the appellant-assessee. Our views are fortified by the decision of Hon'ble High Court of Karnataka in the case of CCE ST., LTU, Bangalore vs. Adecco Flexione Workforce Solutions Ltd. 2012 (26) STR 3 (Kar.). Be that as it may, the provisions of Section 73(3) are applicable in this case as also the Section 80 of the Finance Act, 1994 can be applicable in the peculiar facts and circumstances of the case. Accordingly, we hold that both the lower authorities have erred in holding the appellant-assessee needs to be penalized under Section 77 and 78 of the Finance Act, 1994. Invoking provisions of Section 80 of the Finance Act, 1994, as it was during the rele ..... X X X X Extracts X X X X X X X X Extracts X X X X
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