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TMI Blog2021 (11) TMI 600X X X X Extracts X X X X X X X X Extracts X X X X ..... wholly or partly consisting of money, or where it is not ascertainable. In either of the cases, there has to be a consideration for the provision of such service. Explanation to sub-section (1) of section 67 clearly provides that only an amount that is payable for the taxable service will be considered as consideration . This apart, what is important to note is that the term consideration is couched in an inclusive definition. The Hon ble Apex court in the case of UNION OF INDIA AND ANR. VERSUS M/S. INTERCONTINENTAL CONSULTANTS AND TECHNOCRATS PVT. LTD. [ 2018 (3) TMI 357 - SUPREME COURT] while relying upon their earlier decision in the case of COMMISSIONER OF SERVICE TAX ETC. VERSUS M/S. BHAYANA BUILDERS (P) LTD. ETC. [ 2018 (2) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned Show cause notice. Commissioner (Appeals) has miserably failed to provide any justification to hold that the impugned amounts are received as a consideration for rendering the services as that of tolerating the act of defaulting parties - appeal allowed - decided in favor of appellant. - Service Tax Appeal No. 50105/2019 - FINAL ORDER No. 51941/2021 - Dated:- 9-11-2021 - MRS RACHNA GUPTA, MEMBER (JUDICIAL) Shri B L Yadav, Advocate for the Appellant Shri Mahesh Bhardwaj, Authorised Representative for the Department ORDER The appellant herein are engaged in the manufacture of MS ingots having the Central Excise registration in their favour. During the course of audit of records of the appellant, some miscellaneous i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d retention of compensation / liquidation damage for not delivery of purchased goods by the other party is not the declared service under Section 66E(e) of Finance Act, 1994 as it does not amount agreeing to refrain from or tolerating an act. Learned Counsel has laid emphasis upon decision in the case of M/s. South Eastern Coalfields Ltd. vs. Commissioner of Central Excise and Service Tax, Raipur reported as [2020 (12) TMI 912-CESTAT New Delhi] and the decision in the case of M/s. Steel Authority of India Ltd. vs. Commissioner of GST Central Excise, Salem reported as [2021 (7) TMI 1092- Cestat Chennai]. Order under challenge is accordingly prayed to be set aside. It is impressed upon that in view of the said decisions, even the penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed service. Under section 66E( e), a declared service shall constitute agreeing to the obligation to refrain from an act, or to tolerate an act or situation, or to do an act. Section 66 B provides that service tax shall be levied at the rate of 12 per cent on the value of all services, other than those services specified in the negative list, provided or agreed to be provided in the taxable territory by one person to another and collected in such manner as may be prescribed. Section 66D contains a negative list of services, while section 66E contains a list of declared services. Section 67 and 68 are also relevant for the present adjudication. Section 67 reads as under: 67 . (1) Subject to the provisions of this Chapter, where servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or where it is not ascertainable. In either of the cases, there has to be a consideration for the provision of such service. Explanation to sub-section (1) of section 67 clearly provides that only an amount that is payable for the taxable service will be considered as consideration . This apart, what is important to note is that the term consideration is couched in an inclusive definition. 7. The Hon ble Apex court in the case of Union of India vs. Intercontinental Consultants and Technocrats Ltd. reported as [2018 (10 GSTL 401 (SC)] while relying upon their earlier decision in the case of M/s. Bhayana Builders reported as [2018 (2) TMI 1325] (order does not show that this order has been followed) has held that since service tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any service. Neither the appellant is carrying on any activity to receive compensation nor can there be any presumption for intention of other party to breach or violate the contract and suffer the losses. The only purpose is for minium compensation and of forfeiting the earnest money is to ensure that the default act is not undertaken again or repeated. However, from any stretch of imagination the retention of such amount cannot be said to be an act of receiving consideration that too towards toleration of the defaulting act of the other parties. What only appears from retention of the money in question is the expectation of the appellant that other party should comply with the terms of the contract and such other party shall be burdened i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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