Valuation - Service tax short paid by not including gross amount ...

Service tax short paid by excluding free goods' value. Consideration = agreed amount, not value of free supplies.

Case Laws     Service Tax

August 1, 2024

Valuation - Service tax short paid by not including gross amount charged for services rendered. Gross amount charged defined in Section 67 does not expand meaning to include value of free supply goods. Value of taxable services cannot depend on value of goods supplied free. Consideration is amount recovered/recoverable as per agreed terms between parties. Amount approved by service recipient as per contract is consideration for computing tax liability. Short payment due to non-inclusion of Tax Deducted at Source (TDS) not sustainable as TDS grossed up and tax paid except when refunded due to losses. Denial of Cenvat credit for lack of documents not tenable as invoices contained requisite particulars. Liability under reverse charge mechanism for legal consultancy and rent-a-cab services to be appropriated. Extended period of limitation not invokable for mere verbal allegations without dishonest/fraudulent intent.

View Source