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2024 (12) TMI 1244 - AT - Service TaxLegality of amount collected by the appellant from the sub-agents/customers representing as Service Tax - liability to deposit it to the credit of the Central Government under the provisions of Section 73A(2) of the Finance Act 1994 - Procedural variations - Invocation of the provisions of Section 73A. Legality of mount collected by the appellant from the sub-agents/customers representing as Service Tax - liability to deposit it to the credit of the Central Government under the provisions of Section 73A(2) of the Finance Act 1994 - HELD THAT - It is found that in the entire transaction there is nothing to indicate that an amount representing as service tax that is collected and retained by the appellants. It is found that due to an understanding between the appellant and the sub-agent the liability of the the subagentto pay this Service Tax to the exchequer is shifted to the Appellant and an accounting entry is made as the liability stands discharged at the hands of the Appellant. Effectively the service tax on the portion of the amount of commission paid to the sub-agent is discharged first by the appellant and thereafter recovered. His portion of the commission (net of service tax) is already withheld by the sub-agent. Therefore it cannot be said that the appellants have recovered service Tax from their agents and have not paid it. The only plausible conclusion is that what was recovered was the service Tax already paid by the appellants on the commission actually retained by the sub-agent; no service tax is actually collected by the Appellant which is payable or recoverable under Section 73A. It is found that the SCN alleges that the appellants also illegally collected an amount as representing Service Tax from the sub-agents by wrongly impressing upon them that they (M/s TSIYPL) were providing services to the sub-agents and therefore they (M/s TSIYPL) were entitled to collect Service Tax from them; M/s TSIYPL did not deposit the amount collected by them as representing Service Tax with the Government exchequer. During investigations M/s TSIYPL failed to provide any legal justifications/statutory authority under which Service Tax was collected by them from their sub-agents/customers of the airlines. There are no evidence in the Notice to allege that the appellants impressed upon their sub-agents that they were providing certain services and therefore are eligible to collect some service tax from them. Procedural variations - HELD THAT - It has to be construed that appellants and their subagents are rendering the Air Travel Agent service. As a natural corollary they share the commission and so the tax burden. While alleging that the appellants have collected an amount representing service Tax form their sub-agents Revenue has conveniently ignored the fact that the commission was also shared. It is not the case of the Revenue that tax burden cannot be shared more so when remuneration is shared. There is no law forbidding such sharing of the tax burden when Revenue is shared - Revenue cannot enrich itself on the strength of procedural variations and accounting practices of the appellant. Invocation of the provisions of Section 73A - HELD THAT - Revenue conveniently ignored the fact of sharing of remuneration given by the Airlines by the appellant and their sub-agents. Therefore it was wrong to seek tax again on the sharing of Tax burden. Tax on the total remuneration was discharged. Demanding service tax again on the portion of sub-agent s commission would amount to double taxation - Revenue cannot enrich itself on the strength of procedural variations and accounting practices of the appellant. The amount shown as service tax in the invoice issued by the appellants is to account for the sub-agent s share of service tax. No case is made by revenue for invocation of the provisions of Section 73A. The impugned order is set aside - appeal allowed.
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