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2018 (6) TMI 929 - AT - Service TaxManpower recruitment and supply service - Liability of tax - the lower authorities did examine the various contracts but had failed to consider that the contract with M/s Garware Industries Ltd. was one with lumpsum consideration and not based on number of personnel deployed - Held that:- It is found that while the recompense is specified so, a further provision makes any payment subject to furnishing of periodical bills indicating deployment. Therefore, these cannot be excluded from the liability to tax. We also take note that the terms of the remand order have been diligently complied with - the taxability of the consideration received by the appellants during the period in dispute is upheld. Benefit of cum-tax computation - appellants had discharged their tax liability before the issue of notice though not the interest liability - Held that:- Service tax is an indirect tax and macroeconomic theory has it that indirect taxes are recovered from the end consumer. We have no quarrel with the theory but tax collection is required to be in accordance with law. Finance Act, 1994 does not prescribe collection from the customer; nor does it authorize the provider of the service to act as an agent of the State. Though Service Tax Rules, 1994 does prescribe that tax component be separately indicated in the invoice, tax was for the relevant period was to be computed for collection only against receipts. In these circumstances, the option to bear the incidence of tax vests with the provider. Extended period of limitation - Held that:- There is no evidence of any suppression on the part of the appellants, which are proprietary concerns. The invoking of the extended period is not tenable. The penalties under section 78 of Finance Act, 1994 and the demands in excess of the amount appropriated by the original authority set aside. Appeal allowed in part.
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