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Service Tax - Case Laws
Showing 141 to 160 of 2349 Records
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2014 (12) TMI 595
Constitutional validity of levy of service tax on Advocates and legal services - Scope within the negative list and earlier under section 65(105) (zzzzm) of the Finance Act, 1994 as inserted by the Finance Act, 2011 - interference of function of advocate profession - Held that:- The legislature by inserting such provision has neither interfered with the role and function of an advocate nor has it made any inroad and interference in the constitutional guarantee of justice to all. The services provided to a individual client by a individual advocate continues to be exempted from the purview of the Finance Act and consequently Service Tax but when an individual advocate provides service or agrees to provide services to any business entity located in the taxable territory, then, he is included and liable to pay Service Tax. - That is because the legislature was aware that poor and needy section of the population requires advice, consultancy or assistance in any branch of law, if he requires legal advice, aid and assistance, then, that should be available to him at times immediately and cheaply.
What holds good for chartered accountants and architects must equally apply to other professionals such as advocates, and who too are well conscious of their status. The manner in which the services of lawyers and advocates are rendered has been a subject matter of a decision in the case of disciplinary action initiated by Bar Council of Maharashtra against a professional.
The classification between service provided to business entities and individuals cannot be said to be illusory. The classification has a definite nexus and with the object sought to be achieved. If that is to explore and expand the sources of revenue and by widening the tax net, then, it is achieved by bringing within the fold the aforementioned services. There is, therefore, no violation of the constitutional mandate. The classification cannot be termed as arbitrary, discriminatory, unfair, unreasonable and unjust.
Incidentally, we may observe that no material has been placed before us by the Petitioners which would indicate that for a brief period from the time the impact of levy of service tax fall on them and until the issuance of the notification number 30 of 2012 dated 20th June, 2012 the Advocates suffered in any manner and particularly pointed out in Epari Chinna Krishna Moorthy's case (1964 (3) TMI 55 - SUPREME COURT OF INDIA). - Such advocates are claiming that this Notification of 20th June, 2012 bearing No.30/2012 be given a retrospective effect. It is not possible to accept this argument because the categories of advocates mentioned in these Notifications cannot claim an exemption from the tax and as of right.
Article 39A not only includes free legal aid by the appointment of counsel for litigants but also includes ensuring that justice is not denied to litigating parties due to financial difficulties. That aspect is taken care of in the present tax set up by excluding from the tax net the individual litigants and services provided to them by individual advocates. Therefore, there is no infraction of the constitutional mandate.
Scope of Mega Notification No.25/2012 dated 20th June, 2012 - Held that:- Now, the services provided by individuals as an advocate or a partnership firm of advocates by way of legal services to any person other than a business entity or a business entity with a turnover upto ₹ 10 lakhs in the preceding financial year are exempt from the whole of the service tax leviable thereon under section 66B of the Finance Act. Therefore, the small businessman, petty traders and persons carrying on business in individual capacity would be able to afford the services of individual advocates or a partnership firm of advocates. In such circumstances and when the term 'business entity' has been understood to include a individual he will not be deprived of quality legal services if his turnover in the preceding financial year is within the limits specified above.
Services provided by Arbitral Tribunal or an individual advocate or a firm of advocates by way of support services to any business entity - Reverse charge mechanism - notification is no.30/2012 - Held that:- fter the Arbitration and Conciliation Act 1996 was enacted, the nature of the disputes referred to and to be resolved by arbitration demonstrate that the same has attained the character of “corporate luxury”. The members of the Arbitral Tribunal and those representing parties before the Arbitral Tribunal have started operating in a businesslike manner. It is difficult for individuals to afford the Arbitral services any longer. The hefty fees charged by the Tribunal and the Advocates per day and sometimes per hour make it difficult for litigants including companies to bear the costs of Arbitration. There is no basis for the argument that by the service tax provision section 89 of the Code of Civil Procedure is given a gobye. We are sorry to say this but day after day we receive complaints as to how arbitration is beyond the reach of a common man.
Levy is not unconstitutional - Petitions are dismissed.
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2014 (12) TMI 594
Business Support services - generation and distribution of electricity by using coal - Collection of the charges for disposal of the fly ash from the Cement manufacturers and Brick manufacturers - Held that:- Tribunal had already set aside the demand of tax in the applicant's own case [2013 (10) TMI 436 - CESTAT CHENNAI] for earlier period. Hence, there is no reason to remand this case to the Commissioner (Appeals). Accordingly, we set aside the impugned orders - Decided in favour of assessee.
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2014 (12) TMI 593
Business Support Service, Business Auxiliary Service and Goods Transport Agency Service - whether value of ocean freight, advance manifest charges, bunkering and currency adjustment charges would be included in the taxable value - Held that:- Adjudicating authority observed that it is a composite service including ocean freight etc. It is also observed that the appellants are engaged in the managing, distribution and logistics, the cargo handling is only incidental to logistics activities and therefore service provided by the appellant would be appropriately classifiable under "Business Support Service". Service tax is not leviable on ocean freight. It is appropriate that the adjudicating authority should examine all the issues in the light of the decision in Gudwin Logistics [2009 (11) TMI 157 - CESTAT, AHMEDABAD] and appellants would be directed to produce documents for proper verification - Matter remanded back - Decided in favour of assessee.
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2014 (12) TMI 592
Wrong availment of CENVAT credit - Imposition of penalty - In the invoices, the addresses of the service providers were not mentioned - appellants failed to produce relevant invoices in respect of credit taken - Held that:- Issue arose somewhere in the year 2008-09 and thereafter the appellants took steps to rectify and therefore there is no demand for the subsequent period. The show-cause notice was issued in 2010 and now it is more than 5 years since the issue was opened, yet the appellants have not taken any steps to cure the defect for the past period. Even before the commissioner, no details of invoices where such defects have been rectified were produced and today also, the learned counsel fairly agrees that appellants are still making efforts. Even though assessee relied upon several decisions to submit that it was held in those decisions that the service providers address need not be there, on going through the decisions cited, we find that in none of the cases, the invoices in which service provider's address was not there was the subject matter of dispute. Therefore, there is no precedent decision supporting the view taken by the learned counsel. As regards admissibility of credit on invoices wherein the address of service provider is non-existent, we are not in a position to hold that appellant has made out a prima facie case for waiver - stay granted partly.
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2014 (12) TMI 591
Waiver of pre deposit - Denial of benefit of exemption under Notification No.1/2006-ST dt. 01/03/2006 - completion and finishing services and commercial or industrial construction service - Held that:- For the period after 01/06/2007 also, even if it is held that the service provided by the appellants amounts to completion and finishing service, the activity falls under the taxable service of works contract which provides for exclusion of value of materials and even during the subsequent period, the tax paid by the appellants would be more than what is due if it is classified under works contract service. Appellants have a prima facie case for complete waiver in view of the fact that the matter has been referred to 5 Member Bench; the appellants have paid more tax than what is due and there appears to be a prima facie case for classification of the service under works contract service. In view of the above, the requirement of predeposit is waived and stay against recovery is granted during the pendency of appeal. - Stay granted.
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2014 (12) TMI 590
Imposition of penalty - Commercial training and coaching centre service - Short payment of tax - Held that:- Inasmuch as ST-3 Returns was yet to be filed by the appellant by 25th October 2008, the detection of short payment by the officers on 14th October 2008 is premature detection. The appellants have given a plausible explanation of short payment by submitting that inasmuch as entries were not made in the computers and the data was yet to be entered, there was no mala fide on their part not to pay service tax. The said reconciliation of statement would have definitely been done by them and at the time of filing of ST-3 Returns. Further I also find that the entire case of the Revenue is based upon the scrutiny of the statutory records maintained by the appellant in which case the appellant was not in a position to evade any service tax. Accordingly, I am of the view that no penalty is imposable on the appellant. - Decided in favour of assessee.
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2014 (12) TMI 589
Waiver of pre-deposit of Service Tax, interest and penalty - Manpower Recruitment or Supply Agency Service - Held that:- In view of the fact that the factory is taken over by the Bank and further leased to M/s. Rajaram Bapu Patil SSK Ltd. Prima facie the applicant had made out a case for total waiver of dues. The pre-deposit of dues are waived and recovery of the same is stayed during the pendency of the appeal - Stay granted.
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2014 (12) TMI 588
Refund claim - Quarterly sanction of refund - Held that:- Notification No. 17/2009-S.T., dated 7-7-2009 does not prescribe any such condition that refund claim should be filed on quarterly basis or periodical basis. The refund claim is governed by the provisions of Section 11B of the Central Excise Act, 1944, applicable to Service Tax matters and the time limit is one year from the relevant- date and the relevant date is to be counted from the date of let export order passed. In the absence of any condition in the Notification, the Circular issued by Board prescribing filing of quarterly claim cannot be considered as statutory obligation for rejecting refund. Even though the stay application is under consideration before us, we find that this is only the issue involved in this case and there is nothing more to consider. In these circumstances, we consider that the appeal itself can be disposed of at this stage. Accordingly, the impugned order is set aside - Decided in favour of assessee.
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2014 (12) TMI 587
Denial of CENVAT Credit - Credit denied to them on the ground that on verification, the premises registered in the name of said registered dealer were found to have been taken on rent by him on the basis of a fake and bogus rent deed - Cancellation of dealership - Held that:- Revenue having granted registration to M/s. Rohit Ispat and the appellant having satisfied themselves about the registration, procured the goods from the said registered dealers. The act of transportation of the goods stand established from the payment of service tax by the appellant on the GTA services so received by them. As such, the provisions of Cenvat Credit Rules stand satisfied. Revenue has also not established any alternative source of procurement of inputs. The appellants having procured the inputs from the registered dealer, having reflected the same in their RG-23A Part-I and having utilized the same in the manufacture of final product, cleared on payment of duty, are entitled to benefit of Cenvat credit of the same. Accordingly, I set aside the impugned order and restore the order of original adjudicating authority. - Decided in favour of assessee.
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2014 (12) TMI 586
Refund claim - contention of the applicant is that the applicant paid the service tax under the wrong belief the applicant had provided Clearing and Forwarding Agent service. Held that:- The only contention of the appellant is that as per the definition a person has to undertake Clearing and Forwarding activity. In the present case, M/s. Dynamic Logistics had not undertaken the activity of clearing of the goods from the principal. - As per the agreement, M/s. Dynamic Logistics are to provide service in connection with receiving, storing, packing and discharge of goods comprising of spare parts of the principal. Therefore, it cannot be said that Dynamic Logistics has not undertaken the activity of clearing and forwarding. - where going by the terms and conditions of the agreement under which Dynamic Logistics is undertaking the activity on behalf of the appellant and Dynamic Logistics are receiving the goods from the appellant and thereafter undertaking other activities such as packing, etc., as per the instructions of the appellant and also clearing the goods as per the instruction of the appellant. In view of this, we do not find any merits in the appeal - Decided against assessee.
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2014 (12) TMI 550
Condonation of delay - delay was caused due to the elections to various Co-operative Societies, which were in full swing in Tamil Nadu at the time of receipt of the Order-in-Appeal - Held that:- Authorised Representative for the Revenue placed the documents from the website that the election in respect of these applicants was held during the period from 09.05.2013 to 10.06.2013. It is seen that the papers were signed by the Sub-Registrar/Managing Director. Therefore, the reasons for delay in filing the appeal for election has no substance. The Hon’ble Supreme Court in the case of Office of the Chief Post Master General [2012 (4) TMI 341 - SUPREME COURT OF INDIA] dismissed the appeal and held that in the absence of exigencies, government cannot plead that there was no gross negligence or deliberate inaction or lack of bona fide, an liberal concession has to be adopted to advance substantial justice. In view of that, we do not find any merit in the COD applications. Accordingly, all the COD applications are rejected - Condonation denied.
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2014 (12) TMI 549
Penalty u/s 76 & 77 - service tax on GTA - Held that:- GTA service on which service tax demand was raised is related to export of goods, hence the bona fide belief of the Appellant is established. The Appellant admittedly paid the entire service tax before issuance of show cause notice. They are in any case entitled to Cenvat credit in respect of service tax on GTA being related to export of goods in the light of Hon'ble Gujarat High Court judgment in Inductotherm India P. Ltd. case cited [2014 (3) TMI 921 - GUJARAT HIGH COURT]. Service of GTA is in respect of export, hence the Appellant is entitled for Cenvat credit in respect of service tax paid on GTA for export goods. Therefore the service tax demanded by the revenue was admissible Cenvat credit and it is clear case of revenue neutrality. No reason for imposition of penalty on the Appellant under Section 76, hence the same is waived - However, penalty u/s 77 is upheld - Decided partly in favour of assessee.
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2014 (12) TMI 548
Waiver of pre deposit - Business Support Service - applicant submits that it is a Concession Agreement, which should be treated as a ‘LEASE AGREEMENT’, if at all. - development of Karaikal Port - Held that:- Concession Agreement covers various services and some of the services are taxable services. The Adjudicating authority observed that the applicant had outsourced the activities which are necessarily provided by them. It appears that some portion of the consideration is related to Concession Fees/Royalty Fees. It is seen from the impugned order that the applicant received the amount under the head of Royalty Fees or Concession Fees or Lease Charges represents the consideration received by the Govt. of Puducherry from M/s. Karaikal Pvt. Ltd. for provision of Port Services. Both sides failed to produce the details of the amount received by the applicant in respect of the services clearly, which would be examined at the time of appeal hearing in detail. We have also considered the submissions of the learned Counsel that the demand is party barred by limitation. On a query from the Bench, the learned Counsel submits that the demand of tax for the normal period would be approximately ₹ 82,00,000/-. We noted that there is no dispute that the taxes are levied on the Lease Charges from 01.07.2010. It is not clear the services rendered by the applicant in respect of Royalty Fees/Concession Fees - partial stay granted.
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2014 (12) TMI 547
Business Auxiliary Service - Grinding of wheat into wheat products such as maida, atta, suji and bran for various parties - whether the process amounts to manufacture under Sec 2(f) of the Central Excise Act 1944 or not - Held that:- Board has already accepted this issue that the process would amount to manufacture and no service tax is leviable - Decided in favour of assessee.
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2014 (12) TMI 546
Waiver of predeposit - Site Formation Services - Manpower and Recruitment Agency & Security Services - filling of soil to facilitate erection of towers. - Extended period of limitation - Held that:- Applicant were issued three show cause notices in which ‘Manpower Supply and Security Services’ are common, whereas, in the third show cause notice, the Department had also alleged non-payment of service tax on ’Site Formation’, which claimed to have been noticed by the Department during the course of investigation in the year, 2011. There is some force in the argument of the ld. Advocate for the Applicant that the third show cause notice would be barred by limitation in view of the judgment of the Hon’ble Supreme Court in Nizam Sugar’s case [2006 (4) TMI 127 - SUPREME COURT OF INDIA]. However, regarding the demand relating to ‘Site Formation Services’, we are not convinced that the demand on such services, raised in the third show cause notice for the first time, after necessary investigation by the department, would also be barred by limitation.
Prima facie, we are of the view that the services rendered by the Applicant to M/s. Reliance Telecommunication Ltd. are ‘Site Formation Services’. In these circumstances, the Applicant though could able to make out a prima facie case in their favour for total waiver of the dues against the demand relating to ‘Manpower Supply and Security Services’, whereas, in relation to the demand on account of ‘Site Formation Service’, they could not able to make out a case for total waiver. - Partial stay granted.
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2014 (12) TMI 545
Imposition of penalty u/s 76, 77 & 78 - Simultaneous penalty u/s 76 & 78 - Held that:- As regards the imposition of penalty under Section 76 of the Finance Act, 1994, it is evident from the records that the liability to pay service tax arose in January, 2009 when the bills for the services rendered by the group companies were received by the appellant in December, 2008. Section 78 of the Finance Act, 1944 was amended on 11-5-2008 so as to provide that if penalty is payable under this section, provisions of Section 76 shall not apply. Since in the present case, the liability to pay service tax arose in January, 2009, the question of invoking provisions of Section 76, especially when penalty was considered under Section 78 would not arise at all. Accordingly, the penalty imposed on the appellant under Section 76 is not sustainable in law.
Appellant discharged the service tax liability along with interest thereon as soon as the short payment was pointed out to them and they also intimated to the same to the department vide letter dated 22-6-2011 under the provisions of Section 73(3) of the Finance Act, 1994, much before the show cause notice. It is also a fact that these transactions were reflected in the balance sheets of the appellant for the relevant years. These evidences available on records indicate that the appellant had no intention to suppress any information or withhold any information from the department with an intention to evade payment of service tax. In any case the appellant was eligible for Cenvat credit of service tax paid and there was no need for him to evade any payment of tax. In these facts and circumstances, the decision of the Tribunal in the case of Essar Ltd., cited [2008 (11) TMI 105 - CESTAT, AHMEDABAD] squarely applies. Accordingly, we are of the view that the penalty is not imposable on the appellant under the provisions of Sections 77 & 78 of the Finance Act, 1994, in view of Section 73(3) of the Finance Act, 1994 read with Section 80. - Appellant has not disputed service tax and interest liability and therefore, the appropriation of the same by the adjudicating authority is upheld. - Decided in favour of assessee.
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2014 (12) TMI 544
Mandap Keeper Services - Auditorium rented out for conducting drama performance and other cultural entertainments - Assessee contends that such activity cannot come under purview of Mandap Keeper Service - Whether they are liable to service tax under the category of “Mandap Keeper Services” during the period from 1998-99 to 2004-05 - Held that:- Tribunal in the case of Secretary, Town Hall Committee [2007 (6) TMI 504 - CESTAT BANGALORE] has held that cultural functions are also social functions and renting out the hall for cultural functions would attract Service Tax liability. The said decision of the Tribunal was also upheld by the Hon’ble High Court of Karnataka reported in [2011 (4) TMI 191 - KARNATAKA HIGH COURT]. This Tribunal also followed the ratio of the said decision in the case of Manager, Ravindra Kalakshetra (2007 (10) TMI 208 - CESTAT, BANGALORE) and also in the case of Surat Municipal Corporation v. Commissioner of Central Excise, Surat reported in [2006 (2) TMI 45 - CESTAT, NEW DELHI]. Thus, we are of the considered view that the activity undertaken by the appellant in the present case would get squarely covered under the category of “Mandap Keeper Services” and the appellants are liable to pay Service Tax on the said activity accordingly.
In the case of Statutory/Government bodies, there can be no mala fide intention to evade payment of Service Tax and it can be considered only as an omission on the part of the appellants and, therefore, there is no need to impose any penalty and invoke any extended period of time - demand of Service Tax can be upheld only for the normal period of limitation and not for the extended period. The adjudicating authority is directed to re-compute the duty demand for the normal period of limitation and intimate the same to the appellants for payment. The appellant would also be liable to pay interest on the recomputed demand in terms of Section 75 of the Finance Act, 1994. - there cannot be any mala fide intention on the part of the appellant being a Government body and, therefore, we set aside the penalties imposed on the appellants under Section 80 of the Finance Act, 1994 - Decided partly in favour of assessee.
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2014 (12) TMI 543
Penalty u/s 77 & 78 - Short payment of tax - Held that:- Entire service tax payable was recovered by the appellant from the service recipients. Appellant was a registered unit and was well aware of their liability to pay service tax to the Revenue. Even if there was any financial difficulty, appellant was required to file the periodical returns indicating therein the correct service tax liability. Had the appellant filed such returns showing correct duty liability, which he had already recovered, may be appellant’s bona fides could have been accepted. In the present case, appellant recovered the entire service tax from their customers and also did not file periodical prescribed returns with the Revenue. Non filing of returns and non-payment of service tax, in spite of collecting the same from the customers, clearly convey mala fide on the part of the appellant making them liable to penalty under Section 78 of the Finance Act, 1994. - Decided against assessee.
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2014 (12) TMI 542
Denial of CENVAT Credit - credit of service tax paid in respect of digital photographs - Invocation of extended period of limitation - Held that:- As the entire case of the Revenue was that photographs used for brochure meant for sale promotion cannot held to be eligible input service, the presentation of the brochure before Commissioner (Appeals) cannot held to be a additional evidence so as to hit by the provision of Rule 5 of Central Excise (Appeals) Rules, 2001.
There is no dispute by the lower authorities that the credit was availed and duly reflected in the returns. If there is no column in the returns to show the nature of the input services, the assessee cannot be blamed for not providing the details of the input services. It is well settled that non-disclosure of the fact which is not required to be disclosed in the law, cannot attribute any suppression to the assessee. As such, the reasoning of the Commissioner (Appeals) that appellants have not disclosed the digital photograph service as a service on which credit was availed thus leading to suppression, cannot be upheld. Accordingly, I set aside the demand on the point of limitation - Decided in favour of assessee.
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2014 (12) TMI 541
Penalty u/s 76 - Whether penalty should be imposed upon the appellant when the entire amount of disputed Service Tax and interest for the delayed payment has already been paid - Held that:- It is the case of the appellant that a clear remark was made in the ST-3 return of the relevant period that appellant has stopped paying. Service Tax in view of Delhi High Court’s order. This fact is not disputed as per Para-2 of the OIA dated 17-11-2011-21-11-2011 passed by the first appellate authority. There is also no evidence on record that Service Tax was separately recovered by the customers from their clients and kept with him. In view of Delhi High Court’s order, appellant has a reasonable cause for paying the Service Tax. The same was paid, along with interest, as per the provisions of Section 80(2) inserted w.e.f. 28-5-2011. In view of the above observations and the settled position as per the relied upon case laws, it is held that no penalty was attracted upon the appellant in this case and appeal filed by the appellant is required to be allowed. - Decided in favour of assessee.
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