9911796707
TMI Blog2024 (9) TMI 1415X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant has got reimbursement on account of PF, shoes, insurance, uniform etc. on actual basis which have been made by him. The issue involved in the present appeal is no longer res- integra. As this Tribunal in case of STAR FREIGHT PVT. LTD. VERSUS C.S.T. -SERVICE TAX - AHMEDABAD [ 2023 (9) TMI 71 - CESTAT AHMEDABAD] has held that ' there is no suppuration of fact or malafied intention to evade payment of service tax, demand for the extended period shall not be sustainable also on the ground of limitation.' The impugned Order-In-Appeal is without any merit and is set aside - appeal allowed. - MR. C L MAHAR, MEMBER (TECHNICAL) Shri Mrugesh Pandya, Advocate Appeared for the Appellant Shri P Ganesan, Superintendent (AR) Appeared for the Respondent ORDER The brief facts of the matter are that the appellant firm being a proprietary concern is engaged in providing Manpower Recruitment or Supply Agency Services and are registered with the service tax department as per the provisions of the Finance Act, 1994. During the course of the audit and verification of their reports like balance sheet, profit and loss accounts, ledgers and invoices when compared with the ST-3 returns, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... service tax liability. It is further contended that actual expenditure made by the appellant on account of purchase of uniform, shoes, bonus, leave encashment, PPF and insurance was made by the appellant only on behalf of the employer of the manpower supplied by the appellant and these expenditures have been reimbursed on actual basis to them by the service recipient and thus same should not be considered as taxable value. 2.1 The Ld. Advocate has taken us to the profit and loss account for the year ending 31.03.2007 and tried to explain that the certain expenditure such as expenditure on purchase of shoes was Rs.52,842/- and same have been shown on the income side as Rs. 52,842/-, the Ld. Advocate tried to explain that, it was actual reimbursement of the expenditure made by the appellant towards manpower supplied by him to various service recipients. The Ld. Advocate has tried to emphasize that the gross amount charged by them for providing the service of the Manpower Supply, as per Section 67 of the Finance Act, 1994 includes only the per person charges received by him and the other reimbursement on account of purchase of uniform, shoes insurance, PPF etc. was on account of thei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... count of the supply of the manpower under head Labour Charges the appellant has got reimbursement on account of PF, shoes, insurance, uniform etc. on actual basis which have been made by him. 4.1 We find that the issue involved in the present appeal is no longer res- integra. As this Tribunal in case of Star Freight Pvt. Ltd. vs. C.S.T.-Service Tax- Ahmedabad reported under 2023 (9) TMI 71- CESTAT AHMEDABAD vide order dated 17.08.2023 has held as follows:- 4.1 We first deal with the appeal filed by the Revenue. We find that revenue in their appeal disputed the dropping of service tax demand on the ground that as per the provisions of Rule 5(1) of the valuation Rules, all expenditure or costs incurred by the service provider shall be treated as consideration for the taxable service provided and shall be included in the value for the purpose of charging service tax for the said services. Service provider has not acted as a pure agent for the service recipient within the meaning provided in Explanation 1 to Rule 5(2) of Valuation Rules. Service provider further not fulfilled the conditions detailed in Rule 5 (2) of the valuation Rules. It is beyond doubt that in order to exclude expen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent; (vi) provision of service on behalf of the client; or (vii) a service incidental or auxiliary to any activity specified in sub- clauses (i) to (vi), such as billing, issue or collection or recovery of cheques, payments, maintenance of accounts and remittance, inventory management, evaluation or development of prospective customer or vendor, public relation services, management or supervision, and includes services as a commission agent, but does not include any activity that amounts to manufacture of excisable goods. 4.4 The submission of Appellant is that it was necessary for the Department to specify the activity and the nature of service that was to be taxed and for this it was necessary for the Department to point out the specific clause out of above seven clauses mentioned in Section 65(19) of the Act but that was not mentioned in the show cause notice and impugned order. We find the force in this contention and observed that in the matter of Commissioner of Customs Central Excise, Goa v. Swapnil Asnodkar [2018 (10) G..S.T.L. 479 (Tri. - Mumbai)], a Division Bench of the Tribunal observed as follows : 4. We have carefully considered the submission made by both sides. We f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lauses of Section 65(19) of the Act is being provided and in the absence of any specific service pointed out in show cause notice and order, the demand cannot be confirmed. 4.6 In this context the argument made by Learned CA for the Appellant deserves to be accepted. In the instant case Appellant was not promoting or marketing any kind of goods produced or provided by or belonging to the client ; appellant was not promoting any sort of services provided by any person; appellant was not providing any customer care services on behalf of the client; appellant was not procuring any sort of goods or services which are inputs for the client to attract the provisions of Section 65(19)(v); appellant are not either producer or processor on behalf of the client. Further appellant was not making any provision of services on behalf of the client in order to attract Section 65(19)(vi). Thus, in the absence of any services provided by the Appellant, Service Tax could not have been levied on the amount of incentive/profit share received by the Appellant. 4.7 We also find the Ld. Commissioner has confirmed the service tax demand of Rs. 32,18,471/- under Support Services of Business or Commerce on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the Ld. Commissioner on difference between the amounts received from the client as reimbursable expenses and the amount spent/ incurred is not sustainable. Once the Ld. Commissioner hold that the reimbursable part of expenses is not taxable, then there is no legal basis to confirm the service tax on differential amount under Support Service of Business or Commerce . Further, there is no evidences on records to establish that the said difference amount are pertaining to the service provided by the appellant. We also find that in the case of Bax Global India Ltd. v. Commissioner of Service Tax - 2008 (9) S.T.R. 412 to canvas the point that if any profit has been made in respect of other activity they cannot be subject to levy of service tax as per the decision of the Apex Court in Baroda Electric Meters Ltd. v. Commissioner of Central Excise - 1997 (94) E.L.T. 13 (S.C.). Therefore the service tax demand confirmed by the Ld. Commissioner on difference amount is not sustainable and we set aside the same. 4.10 We also find that major demand are pertaining to the Ocean freight charges and Air Freight Charges. The issue on taxability of service tax on Freight charges and the liability o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant have been submitting all the documents details to the department. In this fact no malafied intention can be alleged against the appellant. In the present case the demand for the period from October 2005 to 2009-10 was issued by show cause notice dated 21.04.2011, other two show cause notices were issued on 21.10.2011 and 22.12.2012 for the period 2010-11 and 2011-12 respectively. Our above view is supported by the following Judgments: In the case of Adani Enterprise Ltd Vs. CST the Hon ble Supreme Court has passed the following decision: 19. As regard the limitation issue argued by the Learned Counsel, we find that in the facts of the present that firstly the issue involved is of pure interpretation of legal provisions therefore, it cannot be said that the Appellant had any mala fide intentions and have suppressed any fact with intention to evade payment of service tax. It is also on record that the Appellant have represented the matter before Audit team and also before department during the investigation of case. This clearly shows that there is no suppression or wilful misstatement on the part of the Appellant. The Appellant in the present matter also provided all the detai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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