9911796707
TMI Blog2024 (6) TMI 766X X X X Extracts X X X X X X X X Extracts X X X X ..... e also it is always the value of service, which is actually rendered that has to be ascertained for the purpose of calculating the service tax payable thereupon. Support drawn from the decision of Hon ble apex Court in the case of COMMISSIONER OF SERVICE TAX ETC. VERSUS M/S. BHAYANA BUILDERS (P) LTD. ETC. [ 2018 (2) TMI 1325 - SUPREME COURT] where it was held that ' The value of the goods/materials cannot be added for the purpose of aforesaid notification dated September 10, 2004, as amended by notification dated March 01, 2005'. Thus, it is absolutely clear that the amount, in question, was not towards rendering the taxable service. In addition, it is also on record that the amount was not actually retained by the appellant. Subseq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f appellant s record, the verification of the ledgers of miscellaneous income for the period 2015-2016, department observed that appellant forfeited earnest money of Rs. 1,44,480/- and Rs. 1,68,000/- from M/s H.K. Iron Industries and M/s Marudhar Constructions respectively. The said amount was forfeited in terms of Clause 24 of General Rules and directions for Guidelines of contractor of Rajasthan State Road Development Construction Limited (RSRDC). Forming an opinion that the amount forfeited is an amount for rendering the declared service defined under Section 66E (e) of the Finance Act, i.e., towards agreeing to the obligation to refrain from an Act or to tolerate an Act or a situation or to do an act. Hence vide show cause notice No. 13 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ubmitted that forfeiture of earnest money has already been denied to be an amount for consideration towards rendering declared service . Otherwise also, the amount was not retained by the appellant. The order under challenge is, therefore, prayed to be set aside and appeal is prayed to be allowed. 5. Rebutting the submissions, learned departmental representative has mentioned that irrespective the appellant had corrected the ledger entry, but the said act does not alter the taxability nor the liability of the appellant towards service tax as has been confirmed vide the order under challenge. Learned departmental representative has relied upon observations of Commissioner (Appeals) in paragraph 6.5 of the order under challenge. Impressing up ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ault 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 if there is any non compliance on its part. Hence question of tolerating the act of default as alleged by the Department, does not at all arises . 7. Once the activity of appellant that is of forfeituring the amount of earnest money is not a declared service, question of retaining said money as consideration fo ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
