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2023 (10) TMI 811 - AT - Service Tax


Issues Involved:
1. Alleged shortfall in payment of service tax.
2. Leviability of service tax on tickets booked outside India.

Summary:

Issue 1: Alleged Shortfall in Payment of Service Tax
The appellant, a project office of Japan Airlines in India, was issued a show cause notice alleging shortfall in service tax payment. The department claimed the service tax amount indicated in the calculation sheet was Rs. 13,93,06,059/- but only Rs. 7.48 crores was deposited, demanding the balance amount. The appellant contended that the figures were in Japanese Yen (JPY), not Indian Rupees (INR), and provided a conversion calculation showing the correct amount in INR as Rs. 11,19,02,540/-. The Commissioner failed to consider this explanation and erroneously upheld the demand. The Tribunal found that the amount was indeed in JPY and converted correctly to INR, thus there was no shortfall in payment. Therefore, the demand based on the alleged shortfall was set aside.

Issue 2: Leviability of Service Tax on Tickets Booked Outside India
The appellant did not initially contest the leviability of service tax on tickets booked outside India. However, during the appeal, it was argued that no service tax was payable on such transactions. The Tribunal noted that this issue was not raised before the issuance of the show cause notice or during the initial proceedings. The matter was remitted to the Principal Commissioner to examine the leviability of service tax on the amount received for tickets booked abroad for journeys starting from India, providing an opportunity for both the appellant and the department to present their submissions.

Conclusion:
The Tribunal allowed the appeal to the extent of setting aside the demand based on the alleged shortfall in service tax payment and remitted the issue of leviability of service tax on tickets booked outside India back to the Principal Commissioner for reconsideration.

 

 

 

 

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