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2017 (10) TMI 801 - AT - Service TaxBusiness Auxiliary Services - appellants are engaged in making arrangements for vehicle loans to interested customers, from various financial institutions, for which the appellants are getting some commission/income as percentage of loan amounts, which is reflected in their books of accounts as incentive received - Held that: - the commission received by the appellant is not in the nature of rental charges as claimed by the appellant. Moreover as per the lease agreement also, appellants are not authorised to sub-let the premises - he financial institutions are providing services of vehicle loans to the customers of the appellant which results in boosting the business of the financial institutions and in recognition of the said assistance rendered by the appellant, the financial institutions reciprocate with commission in some percentage of loan distributed though the appellant and this activity is a clear case of promotion of service rendered by the clients i.e. financial institutions, which is specifically included in the category of BAS specified under Finance Act, 1994 and are liable to service tax w.e.f. 01/07/2003. Such promotion of the business of financial help promote the business of the appellant also and does not alter the character of BAS - the appellants are liable to pay the services tax under the category of BAS. Penalty - Held that: - the penalty was dropped by invoking the provisions of 80 of the Finance Act on account of the fact that there were contradictory decisions on this issue during the relevant time - penalty set aside. Appeal allowed in part.
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