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2014 (11) TMI 166 - AT - Service TaxBusiness Auxiliary Service - co-branding of hose pipes (by manufacturers and HPCL) as well as printing logo - whether HPCL have provided Business Auxiliary Service (BAS) to the manufacturer of hoses, LPG stoves, pressure cookers, kitchen lighters. - Held that:- The appellants have put a weak defence by saying that they are merely endorsing the safety requirements under various regulations cited above. Undoubtedly, the safety regulations which are statutory requirements have to be complied with and the oil companies indeed would have to recommend adherence to such safety regulations. But this does not detract from the fact that the promotion and marketing of goods is being definitely undertaken. The agreements are for co-branding of the goods, sale through HPCL distributor network. The agreement with SUPER LPG states Super LPG approached HPCL for marketing their goods. The agreements clearly provide for specific overriding commission on per piece basis on or on ad valorem basis and such commission is payable over and above the commission payable to HPCL distributors. The commission is for the service rendered by HPCL towards marketing/promotion of goods manufactured by the manufacturers mentioned above. The service tax amount has been correctly demanded and the appropriation of the said amount already deposited is correct in law. - Decided against the assessee. Levy of penalty - Waiver of penalty u/s 80 - Held that:- It is clear that they were aware of requirement of payment of service tax under the agreements. But they chose not to pay the tax. For the sake of repetition, it may be mentioned that the appellants are very old assessees. They are a massive organisation with all expertise. Therefore, non-disclosure of agreements amounting to clear suppression of facts does not give them the benefit of doubt and makes them liable for penalty under Section 78. In similar circumstances, penalty would have been imposed on private companies, there appears to be no reason why the appellant should escape penalty on similar ground. - Decided against assessee.
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