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2010 (5) TMI 261 - CESTAT, BANGALOREBanking Activities - Business Auxiliary Service (BAS) - Cash Management Service (CMS) - Management Consultancy Service (MCS) – Service tax on miscellaneous income shown in the balance sheet – Held that: - merely because the customers of the client are depositing the cheques into the clients account, it cannot be said to be coming within the category of business auxiliary service - The definition of ‘banking and other financial service’ clearly indicate with regard to the asset management and also refers to the asset management in the category of italic (v) of the definition. It also refers to depository and trust services but does not include cash management. The appellants activity is in the category of cash management inasmuch as the clients are operating their accounts and cash flow of the client is coming to the clients account. Therefore, the activity is that of cash management which is excluded from ‘banking and other financial services’ Regarding MCS - Mere perusal of the agreement would indicate that the said agreement is for running the exchange on day to day, by the appellant, because of his expertise in managing the bank and other financial services. This agreement, in our considered view, cannot be considered as services rendered under MCS. On both grounds i.e. services which were rendered by the appellant was outside the territorial waters of India and in a foreign country, and for the reason that the services would not have get covered under the category of MCS, the impugned order to the extent it upholds the demand on this issue, is unsustainable and hence is set aside - Regarding ST in misc income - demand has been raised and confirmed by the lower authorities only on the findings that miscellaneous income which has been shown in the balance sheet of the appellant are nothing but arising out of the services, which are rendered by the appellant. – matter remanded back to reconsider the issue in view of reconciliation statement submitted by the appellants
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