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2015 (12) TMI 442 - AT - Service TaxDemand of service tax - Business Auxiliary service - Car rental service and Service tax on foreign exchange currency - Held that:- Adjudicating authority has confirmed service tax demand on crate rentals under Business Auxiliary Service (BAS). The appellant has contended that the supply of crates amounted to deemed sale, which was liable to VAT/sales tax as the effective control and possession of the goods were transferred by the appellant. It is seen that Customs, Excise and Service Tax commissionerate, Thane-I, vide Order-in-Original No.93/BR-93/ Th-I/2012, dated 28.02.2012 confirmed the demand of central excise duty on amount collected as crate rental holding that the same was includible in the assessable value for the purpose of central excise duty. Hyderabad Commissionerate vide its Order-in-Original No.31/2011/Hyd-III/Adjn-ST, dated 15.12.2011 has dropped a similar service tax demand on crate rental. The onus to prove that the service tax is leviable is totally on Revenue. Similarly, the observation of the adjudicating authority that “because the appellant never clarified as to why such amount was spent, it can be deduced that the payments made in foreign exchange were undoubtedly for the services received by the appellant in India in relation to the said taxable services” is completely devoid of legal basis because it is Revenue which is required to establish that the amount of foreign exchange spent was for receiving taxable service from abroad. Further, the observation of the adjudicating authority that the appellant never clarified as to why such amount was spent is also not correct as the appellant gave details of the foreign exchange expenses and the purposes thereof. The observation of the adjudicating authority that, “hence it is invariably admitted and stand proved that there is a direct nexus between the said expenditure and the taxable service” is factually incorrect because the appellant never so admitted. While Revenue may not be required to prove the case with mathematical precision, it does not mean that Revenue can simply presume that all the foreign exchange payments were for obtaining taxable services from abroad and abdicate its responsibility to establish the case on the principle of preponderance of probability (though admittedly not with mathematical precision). Demand of service tax and penalty is set aside - Decided in favour of assessee.
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