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TMI Blog2024 (4) TMI 821X X X X Extracts X X X X X X X X Extracts X X X X ..... present issue whether the reimbursable expenses are includable in the taxable value or not, has been examined by this Tribunal in the case of M/s Ganga Carrier Private Limited [ 2023 (9) TMI 809 - CESTAT KOLKATA ], wherein this Tribunal has observed all the 'reimbursement expenses' have been included in the consideration with effect from 14/05/2015. Hence while calculating service tax, the service provider has to include all the expenses whatever he incurred for rendering service, w.e.f.14.04.2015 only and not before that period. The dispute in the present appeal pertains to the period from 2000-01 (October) to 2004-05 (September) and hence, the substitution brought in the definition of 'Consideration' vide Finance Act, 2015 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... charged to their clients an amount of Rs.21,74,65,342/- and an amount of Rs.20,71,78,011/- as reimbursable expenses. However, the appellant has declared taxable value as Rs.3,13,96,519/-. 2.1 The case of the Revenue is that the appellant has incurred expenses showing reimbursable expenses but the tax was paid on some charges taking into consideration the same as taxable value for CHA services. 2.2 On the said basis, a show-cause notice was issued to the appellant to demand differential service tax for payment of service tax on reimbursable expenses claimed by the appellant. 2.3 The matter was adjudicated. The demand of service tax was confirmed. 2.4 Against the said order, the appellant is before us. 3. The ld.Counsel for the appellant subm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d are to be reimbursed to the appellant on actual basis as the appellant is a pure agent. For better appreciation, one of such agreement is extracted here : 7. On going through the agreement itself, we find that the appellant is only pure agent and all the expenses for transportation, loading and un-loading etc. paid by the appellant were reimbursed from the Principal on actual basis. In that circumstances, the appellant is not required to include the reimbursable expenses in their taxable services. 8. Moreover, the present issue whether the reimbursable expenses are includable in the taxable value or not, has been examined by this Tribunal in the case of M/s Ganga Carrier Private Limited (supra), wherein this Tribunal has observed as under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the Respondent has recovered precisely the same amount from the recipient that has been paid on their behalf by producing the documentary evidence in regard to such expenditure. Thus, it is clearly established that the Respondent has acted as 'Pure Agent' while incurring such expenditure. 16. We observe that all the 'reimbursement expenses' have been included in the consideration with effect from 14/05/2015. Hence while calculating service tax, the service provider has to include all the expenses whatever he incurred for rendering service, w.e.f.14.04.2015 only and not before that period. The dispute in the present appeal pertains to the period from 2000-01 (October) to 2004-05 (September) and hence, the substitution brou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rvice in such manner as may be prescribed is expressly made subject to the provisions of sub-section (1). The thread which runs through Sections 66, 67 and Section 94, which empowers the Central Government to make rules for carrying out the provisions of Chapter V of the Act is manifest, in the sense that only the service actually provided by the service provider can be valued and assessed to service tax. We are, therefore, undoubtedly of the opinion that Rule 5(1) of the Rules runs counter and is repugnant to Sections 66 and 67 of the Act and to that extent it is ultra vires. It purports to tax not what is due from the service provider under the charging Section, but it seeks to extract something more from him by including in the valuation ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pports the view taken by the adjudicating authority in the impugned order. Accordingly, we hold that there is no infirmity in the impugned order and uphold the same. 19. In view of the above discussion, we uphold the impugned order and reject the appeal filed by the department. 9. As this Tribunal has already been held that the reimbursable expenses are not includible in the taxable value of services, therefore, we hold that the reimbursable expenses in this case, are also not includable in the taxable value of service. Therefore, we hold that the appellant has correctly paid the service tax during the impugned period. 10. Consequently, no demand of differential service tax is sustainable against the appellant. 11. In view of this, we do no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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