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2007 (3) TMI 752 - AT - Service TaxLevy of Service Tax - Services of C&F agents - instructions contained in the Service Tax Trade Notice No. 20/2002 - HELD THAT:- The Explanation II to section 67 only clarifies the general principle that when no tax is separately collected from the client, the gross amount collected is inclusive of the tax. This principle is applied in the Central Excise cases also in the light of the CCE v. Maruti Udyog Ltd. [2002 (2) TMI 101 - SUPREME COURT] case decided by the Supreme Court. Even in respect of removal without payment of duty when the duty liability is computed the sale value is taken to be cum-duty value. The same principle has to be applied here also. Therefore, we set aside the impugned order and remand the matter to the Original authority for re-computation of the duty liability taking the gross receipt as inclusive of service tax. It is seen that when the appellants came to know all the correct legal position, they voluntarily paid even before the issue of show-cause notice. Thus, the imposition of penalty on the appellant is not sustainable. The same is set aside. Therefore I remand the matter to the Original authority to re-compute the tax liability and allow the appeal.
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