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TMI Blog2018 (10) TMI 1007X X X X Extracts X X X X X X X X Extracts X X X X ..... other law for the time being in force - as per clause (e) of Sub-section (1) to of Section 26 of SEZ Act, 2005, every developer and entrepreneur is entitled to exemption from service tax under Chapter V of Finance Act, 1994 on taxable services provided to developer or units to carry on the authorized operations in Special Economic Zone - demand of ₹ 30 lakhs (approximate) is not sustainable. Demand of Service Tax of ₹ 5,61,455/- - on the basis of difference in the income reflected in balance sheet with that reflected in ST-3 returns, the said amount of ₹ 54,51,017/- was treated as consideration without identifying whether the same was received for rendering any service - Held that:- Through the Final Order passed by this Tribunal in the case of Shubham Electricals [2015 (6) TMI 786 - CESTAT NEW DELHI]. This Tribunal in Para-11 of the said order has observed as follows: “Neither the show cause notice dated 21/10/2011 nor the impugned adjudication order dated 18/01/2013 record any assertion/conclusion whatsoever as to which particular or specific taxable services the appellant had provided. In the absence of an allegation of having provided a specific taxable se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d that reflected in the balance sheet for the relevant period. The said difference was to the tune of ₹ 15,88,07,829/-. The appellant and Revenue Authorities exchanged correspondence on the said issue. However, it appeared to Revenue that service tax amounting to ₹ 35,82,676/- should be paid by the appellant on the said differential value. Further in respect of services rendered to International Financial Corporation appellant had received an amount of ₹ 30 lakhs (approximate). It appeared to Revenue that appellant should pay service tax of ₹ 3,30,011/-. On contest the Original Authority has confirmed the demand of Service Tax of ₹ 23,83,91,899/- along with interest and imposed equal penalty through impugned Order-in-Original dated 31/10/2013. The allegations, findings and confirmed demand are tabled below:- Sr. No. Allegations Amount Findings Demand Confirmed 1. Difference in income reflected in ST-3 Returns and that reflected in the Balance Sheets for relevant period INR 1,58,80,7829/- i. Till 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s it pertains to directors telephone expenses and not towards any taxable service. iii. Service tax is payable on INR 5,80,327/- on training services. 71,734/- Total 23,83,91,899 3. Aggrieved by the said order appellant is before this Tribunal. Heard both the sides and considered submissions from both the sides. The individual demands and our findings are recorded hereinafter:- A. Demand of service tax of ₹ 23,44,07,478/-. (i) The learned counsel for the appellant has submitted that the details of Skill Development Programme for rural BPL Youths under Swarnjayanti Gram Swarozgar Yojana implemented by Ministry of Rural Development of Government of India is available at Page-107 onwards in appeal paper book. He has submitted that object of the said programme was for development of skill of specified number of youths from below poverty line strata of society where 75% of the amount required for imparting training and improving skills was to be borne by Government of India through grant-in-aid and 25% was to be collected from contribution from n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Government as grant-in-aid and by following decision of this Tribunal in the case of Apitco Ltd. as affirmed by Hon ble Supreme Court, we hold that service tax is not leviable on the amount received from Government as grant-in-aid. Further, we accept the contention of the learned counsel for the appellant that the contribution received from non-governmental agencies was not in respect of any specific service rendered to the organization from whom the money was received and the money received had no relation with the number of people to be recruited by such organization and therefore, we do not find any service provider and service receiver relationship between the appellant and the organizations from whom contribution of ₹ 2.31 crore (approximate) was received by the appellant. Therefore, we set aside the demand of service tax of ₹ 23,44,07,478/- alongwith interest and equal penalty. B. Demand of Service Tax of ₹ 30,21,221/-. (i) Learned counsel for the appellant had submitted that said demand of service tax of ₹ 30,21,221/- is part of confirmed demand of ₹ 35,82,676/-. He further submitted that learned Original Authority has confirmed said dema ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fic taxable service in the show cause notice and in view of the failure in the adjudication order as well, neither the show cause notice nor the consequent adjudication order could be sustained. Relying upon the precedent decision of this Tribunal, we hold that demand of service tax of ₹ 5,61,455/- is not sustainable. Therefore, we set aside the same along with interest and equal penalty. D. Demand of Service Tax of ₹ 3,30,011/-. (i) The learned counsel for the appellant has submitted that appellant had rendered service to International Financial Corporation. The learned Original Authority has held that IFC is not notified under Section 3 of UN Act, 1947 and therefore, there is no exemption for any service rendered to IFC and that therefore he confirmed the demand of service tax of ₹ 3,30,011/-. He has submitted that this Tribunal had an occasion to examine whether services rendered to International Financial Corporation are taxable for service tax or not. The said issue was examined in the case of Coastal Gujarat Power Ltd. vs. Commissioner of Service Tax, Mumbai-I reported at 2016 (12) TMI 229 CESTAT, Mumbai. He has submitted that the conclusion drawn by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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