Home Case Index All Cases Service Tax Service Tax + AT Service Tax - 2020 (4) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2020 (4) TMI 182 - AT - Service TaxValuation - inclusion of cost of fuel supplied, or reimbursement for fuel, the actual spending in the assessable value - section 67 of Finance Act, 1994 read with rule 5 of Service Tax (Determination of Valuation) Rules, 2006 - HELD THAT:- The decision of the Hon’ble Supreme Court in re Bhayana Builders (P) Ltd [2018 (2) TMI 1325 - SUPREME COURT] resolved the controversy over the inclusion of goods/ materials supplied by recipient of service, with consequent reduction of cost of contracted undertaking, in the consideration to be taxed for provision of the service. Doubtlessly, the issue arose from the claim for the benefit of abatement of 67% of ‘gross amount charged’ in notification no. 15/2004-ST dated 10th September 2004 which was amended to explain the expression ‘gross amount charged’ by notification no. 4/2005-ST dated 1st March 2005 - Nevertheless, the decision of the Hon’ble Supreme Court, having gone into the scope of includability of nonmonetary receipts in consideration, does establish the principle that applies across-the-board. There can be no room for doubt that the goods supplied by the recipient of the service without any charge and which, in consequence, does not find inclusion in the recompense for the taxable service is not includable for the purposes of assessment of tax on services. Hon’ble Supreme Court in Union of India v. Intercontinental Consultants & Technocrats (P) Ltd [2018 (3) TMI 357 - SUPREME COURT] held that the amendment in section 67 of Finance Act, 1994 effected on 14th May 2015 validates rule 5 of Service Tax (Determination of Valuation) Rules, 2006 only prospectively - Adverting to the contours of the plea of Union of India in their writ appeal challenging the nullifying of rule 5(1) of Service Tax Rules, 1994, incorporated for the specific purpose of including ‘reimbursable expenses’ in ‘gross amount charged’ except in circumstances enumerated in rule 5(2), and the statutory provisions, the Hon’ble Supreme Court, finding that legislations which modified accrued rights or which impose obligations or impose new duties or attach a new disability have to be treated as prospective unless the legislative intent is clearly to give the enactment a retrospective effect; unless the legislation is for purpose of supplying an obvious omission in a former legislation or to explain a former legislation - It was also held that the curative legislation effected from 14th May 2015 may, if at all, be applied only prospectively without going into the legality thereof. The submission of Learned Authorized Representative that later decisions of the Tribunal have acknowledged the scope for inclusion after examining the applicability of the above decision does not merit consideration by us. There is no allegation that the appellants were at any stage entitled to use the fuel for operation of other contracts on which higher amounts were charged. Appeal allowed - decided in favor of appellant.
|