9911796707
TMI Blog2009 (1) TMI 172X X X X Extracts X X X X X X X X Extracts X X X X ..... service tax. The lower authorities had rejected the claim of the appellants that they were not paid any charges for the free services rendered either by the manufacturer of the vehicles or by the purchaser of the vehicles - the tax was demanded on the margin earned by then on sale of the vehicles as they collected no charges for the first three services – held that no service tax can be levied on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e said service. The impugned demand is relatable to the first three free services rendered in respect of new vehicles purchased from them. The demand is raised on the basis of Circular No.87/05/06-ST dated 06.11.2006 issued by the CBEC. This circular had clarified that where service charges are reimbursed by the vehicle manufacturers, such reimbursement should be subject to service tax. The lower ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d. Vs Commissioner of Central Excise Service Tax, Patna reported in 2008 (9) S.T.R. 356 (Tri.-Kolkata)] in support of this plea. 2. Heard both sides. There is no dispute that the subject demand is raised on dealer's margin received by the appellants, relatable to free service rendered to buyers of vehicles. I find that the issue involved is no longer res integra. The Tribunal had observed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot to provide free after sales service. In our view, the entire amount including the dealer's margin has been rightly taxed to sales tax representing the value of the cars. The provision of free servicing is merely incidental and intended to promote the sale of the cars. Hence, we are of the view that no service tax can be levied on the amount representing the dealers' margin or any part of it whi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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