9911796707
TMI Blog2019 (1) TMI 1820X X X X Extracts X X X X X X X X Extracts X X X X ..... consultancy services, etc. The appellant's primary business is development of properties for sale. 2. The appellant paid Service tax on reverse charge basis, in the F.Y. 2012-13 upon receiving legal consultancy services, even though the appellant was eligible for exemption under the Notification No. 25/2012-S.T. (at Sl. No. 6) which exempted a business entity from Service Tax, if the turnover in the previous financial year was equal to or less than 10 lakhs rupees. As per the appellant, his turnover for the F.Y. 2011-12 was Rs. 2.04 lakhs and for F.Y. 2012-13 was Rs. 6.78 lakhs which was below Rs. 10 lakhs, and he was eligible for exemption under Notification No. 25/2012-S.T. 3. Pursuant to above, the appellant filed a refund a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion No. 25/2012, dated 20-6-2012, under which the appellant claimed the exemption. 7. The instant appeal is preferred against the Impugned Order dated 28-2-2014. The appellant has taken us through the Notification No. 25/2012-S.T. It is submitted that Serial No. 6 of the said notification exempts the services provided by an individual as an advocate or a partnership firm of advocates by way of legal services to, a business entity with a turnover up to rupees ten lakh, in the preceding financial year. 8. The Ld. Counsel for the appellant Sh. Puneet Agrawal submits that definition clause provided in the said notification, nowhere defines the term 'Turnover', neither does Finance Act, 1994 defines the said expression. It is theref ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion to the source of revenue that arises from the principal revenue generating of an enterprise'. In case of a contractor the construction activity is its principal revenue generating activity. Hence the revenue recognized in the statement of profit and loss of a contractor in accordance with the principles laid down in AS-7, by whatever nomenclature described in the financial statements, is considered as 'turn-over.' 10. In light of the above, the appellant seeks to submit that the authorities below have erred in relying upon the definition provided in Companies Act, 1956, without any justification whatsoever. The appellant therefore submits that changes in inventory of work in progress as appearing in the Financial Statement cannot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cate or partnership firm of advocates providing legal services ; (ii) any person other than a business entity; or (iii) a business entity with a turnover up to rupees ten lakh in the precedineg financial year; or (emphasis supplied) .... ...." 14. We find that the expression "turnover" is not defined in the Notification No. 25/2012-S.T. or in the Finance Act, 1994, and hence in order to interpret the meaning of the said term, in Serial No. 6 of Notification No. 25/2012-S.T., the common parlance meaning of the said term as understood by those dealing in accounts and taxation would have to be taken. 15. We find that the meaning of the said term has already been authoritatively explained by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clear from Para 25 of the judgment : 25. So as to be more accurate about the word "turnover", one can either refer to dictionaries or to materials which are published by bodies of Accountants. The Institute of Chartered Accountants of India (hereinafter referred to as the 'ICAI') has published some material under the head "Guidance Note on Tax Audit Under Section 44AB of the Income tax Act". The said material has been published so as to guide the members of the ICAI. In our opinion, when a recognized body of Accountants, after due deliberation and consideration publishes certain material for its members, one can rely upon the same. Para 5 of the said Note deals with "Sales", "turnover" and "gross receipts". Paras 5.2 and 5.3 of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as explained hereinabove. The said sales would definitely not include the scrap material which is either to be deducted from the cost of raw material or is to be shown separately under a different head. We do not see any reason for not accepting the meaning of the term "turnover" given by a body of Accountants, which is having a statutory recognition. 17. Thus, as per the law declared by the Supreme Court, turnover means the aggregate amount for which sales are effected or services rendered by an enterprise. 18. Applying the abovesaid principle to the facts of the present case, we find that the amount of increase in inventory, which the lower authorities have treated as turnover, is not a sale by the appellant. To the contrary i ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
