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Service Tax - Case Laws
Showing 41 to 60 of 2343 Records
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2015 (12) TMI 1357 - CESTAT MUMBAI
Demand of service tax - composite works contract - Erection, Commissioning and Installation service for the period 01.07.2003 to 31.03.2006. - Held that:- Adjudicating authority has recorded that the scope of work mentioned in tender documents includes supply, erection, testing and commissioning of electrical sub-stations and external electrification works. After recording such finding, the adjudicating authority has vivisected the said contract and charged service tax liability under "erection, installation and commission" services. We find that the issue is no more res integra as has been decided by the Apex Court in the case of Larsen and Toubro and Ors. reported at [2015 (8) TMI 749 - SUPREME COURT] - the said contract cannot be vivisected. - impugned order is unsustainable and liable to be set aside - Decided in favour of assessee.
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2015 (12) TMI 1356 - CESTAT NEW DELHI
Demand of service tax - Banking and Other Financial Services - whether the hire purchase service rendered by the appellant prior to 16.08.2002 was covered under the scope of BOFS as defined under section (65) (10)/(12) - Held that:- as evident that to be covered under BOFS prior to 16.08.2002 the hire purchase service had to be rendered by such body corporate which was a banking company or a financial institution including a non-banking financial company. As per section 65 (11) ibid banking company has the meaning assigned to it in clause (a) of section 45 A of the Reserve Bank of India Act, 1934 - appellant does not qualify to be called non-banking financial company. So, it is established that the appellant is not a banking company nor a financial institution including a non-banking financial company and therefore the service rendered by it prior to 16.08.2002 was not covered under BOFS because prior to that date financial leasing services including equipment leasing and hire purchase by a body corporate were covered under BOFS only if such body corporate satisfied the requirement of being a banking company or a financial institution including a non-banking financial company.
All the hire purchase agreements in respect of which the demand has been confirmed under BOFS were entered into prior to 16.08.2002 and that this assertion was made even before the primary adjudicating authority and has not been contested in the primary adjudication order. CBEC vide circular No.B11/1/2001-TRU, dated 09.07.2001 issued at the time of introduction of levy of service tax BOFS in para 2.1.4 clarified that the hire purchase agreements entered into prior to the imposition of levy i.e. 16.07.2001 will not be chargeable to service tax provided the goods are also delivered prior to 16.07.2001. - in respect of hire purchase agreements entered into by the appellant prior to 16.08.2002 where the vehicles were also delivered prior to 16.08.2002 were not liable to service tax under BOFS. Ld. advocate for the appellant fairly conceded that (i) while all the hire purchase agreements in respect of which the service tax demand of ₹ 39 lakhs has been confirmed were entered prior to 16.08.2002, but he could not confirm whether all the vehicles thereunder were also delivered prior to 16.08.2002 (ii) in respect of such hire purchase agreements where the vehicles were delivered on or after 16.08.2002 the service tax under BOFS would be leviable and for that purpose the case may have to be remanded to the primary adjudicating authority for verification and computation. - service tax is leviable under BOFS in those cases where even if the hire purchase agreements were entered into prior to 16.08.2002, the delivery of vehicles took place on or after 16.08.2002.
In the ordinary course it may have been possible for an assessee to have bona fides belief about the non-leviability of service tax, the fact that the appellant did not provide the information in spite of being asked to do so several times evidently tantamount to suppression of facts which as per Section 73 ibid is sufficient for invocation of extended period. We however need not dwell on this issue in greater detail as the impugned demand has not been found to be sustainable except to the extent of such hire purchase agreements where the delivery of vehicle took place after 16.08.2002 which the appellant has also conceded and this demand is likely to be very small. Penalty under Section 78 ibid will get attracted but in the wake of the decision of Gujarat High Court in the case of Ratnamani Metals & Tubes - [2013 (12) TMI 1397 - GUJARAT HIGH COURT], the appellant will be eligible for reduced (25%) of the mandatory penalty as this option had not been expressly given to the appellant earlier. - Decided partly in favour of assessee.
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2015 (12) TMI 1320 - CESTAT CHENNAI
Business auxiliary service - Valuation - Inclusion of Royalty - Appellant provided service to telecommunication operators to make use of the contents provided to it though the copyright agreement entered into with the music companies - Held that:- There is a demarcated line in the licensing agreement itself demonstrating that the telecommunication companies were stranger to the copyright owners which were the music companies. There was a privy between the appellant and the music companies to distribute the copyright what was conferred by the music company on the appellant. Therefore, Revenue has nothing to do to make an exercise to bring music companies into the picture to determine incidence of tax. Revenue proceeded on the fact that what was realized by the appellant was undisputedly in respect of taxable service provided to the telecommunication operators. That receipt should be brought into the tax ambit. They have done so. The appellant has collected appropriate service tax in respect of the value of service provided to the telecommunication operators. That does not give any scope to bifurcate tax element.
Prima facie, examination of the license agreement extracted by the learned adjudicating authority in the impugned order shows that the copyright holder was also aware that the appellant is going to exploit the copyright for mutual benefit of each other. Therefore, at this stage it looks like a case of advancement of business of music companies by the appellant. Therefore, prima facie, liability of appellant arises. - Partial stay granted.
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2015 (12) TMI 1319 - CESTAT CHENNAI
Waiver of pre deposit - Recovery of tax by way of pre deposit - Revenue neutrality - Held that:- The partnership firm M/s. SKB entered into contract with the land owner and execution of the constructionwork was entrusted to the company M/s. SKBDPL. Service tax law is very specific prescribing incidence of tax on the service provider who provides taxable services except the cases of reverse charge mechanism levy. Keeping the provisions of the enactment in view and modus operandi of the parties, without prejudice to the grounds of appeal of the appellants, appellant SKBDL is directed to deposit ₹ 20,00,000 within four weeks - Partial stay granted.
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2015 (12) TMI 1318 - CESTAT ALLAHABAD
Waiver of pre deposit - rent-a-cab operating services for use by an educational body - SEZ - benefit of Notification would not be available under Notification No.4/2004-ST dated 31.03.2004, which was superseded by Notification No.9/2009-ST dated 03.03.2009 and further superseded by Notification No.17/2011-ST dated 13.03.2011 - Held that:- Rent a cab service is an approved service for the unit located in SEZ. Accordingly, it appears that such service is wholly exempted being provided to the SEZ unit premises. So far the services provided to Educational Institute is concerned though a part of it is provided to another transporter, similarly situated, under the agreement to share mutual spare capacity, it appears that as the services are admittedly provided for transport of staff and student of the schools, the same appears to be permitted exemption/not taxable under the definition in Clause 65 (20) of the Finance Act, 1994. In view of the said proviso, provided under rent-a-cab operating services for use by an educational body imparting skill or knowledge or lesson on any subject or field, other than a commercial training or coaching centre, are not includible in the meaning of "cab" and hence not taxable in the "rent-a-cab operator service". Thus we find that the appellants have made out a prima-facie case for grant of stay. Accordingly, we grant the stay for demand of duty and tax, interest and penalty till disposal of appeal - Stay granted.
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2015 (12) TMI 1317 - CESTAT NEW DELHI
Adjustment of the amount of service tax paid in excess towards payment of service tax in the subsequent period in terms of Rule 6 (3) of Service Tax Rules - Non fulfillment of condition of the said Rule which required the assessee to refund the value of the taxable service and the service tax paid thereon to the person from whom it was received - Held that:- No value of service or service tax had been realised by the appellant from the customers - appellant was entitled to adjust the service tax paid in excess if it had refunded the value of taxable service and service tax thereon from whom it was received. It has been noted by the primary adjudicating authority and has not been disputed by the revisionary authority that the excess payment of service tax was not in relation to any amount recovered for rendition of service from any customer nor was the service tax paid in excess recovered from the customers as it was paid due to calculation errors. Thus, the adjustment made by the appellant is not in violation of the said Rule. - appellant was entitled to such adjustment - Decided in favour of assessee.
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2015 (12) TMI 1316 - CESTAT MUMBAI
Demand of service tax - Tour operator service - whether the activity of transportation services, that is carrying employees of companies from specific points to the factory/establishment and back can be categorized under “Tour operator” service as defined under Section 65(105)(n) read with Section 65(115) of the Finance Act - Held that:- neither the adjudicating authority nor the Commissioner (Appeals) had brought out the clear distinction between the levy on tour operator service pre - 2004 and post - 2004. As regards the period pre - 2004, the issue has been dealt with total in Tribunal’s Order in the case of M/s Jai Somnath Transportation and Others [2015 (11) TMI 835 - CESTAT MUMBAI]. In the said order reliance was placed on various judicial pronouncements including of the Hon'ble Madras High Court in the case of Secy. Federn. Of Bus-Operators Assn. of T.N. Vs. Union of India [2001 (4) TMI 7 - MADRAS HIGH COURT] holding that the vehicles which are covered under the definition in Section 2(43) of Motor Vehicles Act read with Rule 128 of Central Motor Vehicles Rules alone would come within the definition of “Tourist Vehicles” in Section 65(115) and be covered under the Tour Operator service - intent of the legislature was to expand the levy of service tax for planning/scheduling/organizing/arranging the package tours for all modes of travel. It was not intended to expand the scope to cases such as the present one. In the present case, the appellants provide/supply the contract carriage business (not tourist vehicles) to their customers on their demand only. Therefore the activity of the appellant is not covered by the definition of “Tour Operator” for the period post 10-09-2004.
Lower authorities have given no reasoning to state that the activity of the appellants post 10.9.2004 gets covered under the first part of the definition of Tour Operator service. As already observed above, the appellant were providing vehicles/buses to their customers on agreed terms during the period specified for an agreed commercial consideration for transportation of the company/factory employees, at specified places through specified routes and timings. It is also not shown by Revenue that the appellant had authority to pick-up or drop the said persons at any place/route of their choice or they had flexibility to alter the route or timings according to their own choice or whims and fancies. Therefore the employees of only those companies/factories etc., who had entered into a contract had the authority to board the buses at pre-determined pick-up points at fixed timings agreed upon. No element of planning or scheduling is therefore shown to have been done by the appellant. They only act at the company’s behest-II. Thus, we find from the above that appellant were not engaged in the business of planning, scheduling, organizing or arranging package tour of their own as provided under the new definition of “tour operator” service but were adhering to the conditions laid down with various customers. Therefore it cannot be said that they were covered under the first part of the amended definition of “tour operator”. - Decided in favour of assessee.
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2015 (12) TMI 1315 - CESTAT MUMBAI
Denial of Abatement claim - whether the appellant is liable for abatement of 50% of the gross amount charged by him under the Outdoor Catering Services, though he has been awarded the entire contract of maintenance of guest house which includes the cleaning and housekeeping services - Held that:- Adjudicating authority as well as the first appellate authority has come to a conclusion that the value of the contract awarded to the appellant, needs to be bifurcated and tax liability needs to be upheld under the category of cleaning and housekeeping services after denying them benefit of abatement of 50% of the gross value - both the lower authorities have mis-directed themselves in the entire case. On a perusal of the records, we find that M/s L&T has issued works order for annual maintenance contract of guest house which included the scope of maintaining the guest house providing the catering as per the terms and conditions. The appellant undisputedly discharged the Service Tax liability on the bills raised by them under the category of outdoor catering services after claiming abatement of 50% of the gross amount as provided. We find that the issue is no more res integra as this Bench in the case of Centre for Development of Advance Computing Vs. Commissioner of Central Excise, Pune - [2015 (8) TMI 642 - CESTAT MUMBAI] has held that the Service Tax law, no where states that if two distinct activities are undertaken or provided in a single agreement, they should not be taxed under the same service category. In view of the clear law as has been settled by the Bench, we find that the impugned order is unsustainable and liable to be set aside - Decided in favour of assessee.
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2015 (12) TMI 1273 - CESTAT CHENNAI
Demand of service tax - Rent a cab Service - pick-up and dropping of the employees in the SEZ - Whether, this will result in service provided to SEZ hence not eligible to service tax - Held that:- Pick-up and dropping may be due to discharge of contractual obligation as part of remuneration package of employee. But that does not appear to have no relevance in the course of the integral connection to the SEZ. Secondly, the letter of Commerce Department is issued on 19.11.2013 bringing Rent-a-Cab service to the fold of exclusion. Rent-a-Cab service is expected to terminate in the SEZ to fall with the scope of exclusion. Appellants case does not appeal to be appreciated at this stage that above service fall in the exclusion category and that too when exclusion was permitted by Ministry beyond the date of adjudication period. Thirdly, it also does not appear to commonsense that the services has any integral connection to appreciate as input service. - Assessee directed to make pre deposit - Decided against assessee.
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2015 (12) TMI 1272 - CESTAT CHENNAI
Waiver of pre deposit - Demand of service tax - Manpower supply service - Held that:- Prima facie, contention of the appellant does not appeal to common sense when the manpower supply contractor has a liability to compensate the labourers engaged. The contract is only concerned with the agreed amount to be paid to the contractor. Bifurcation of the receipt does not ipso facto take away the appellants from the scope of taxation. However, all these are our prima facie view without expressing any opinion at this stage. - Keeping in view interest of Revenue, appellants are directed to predeposit 10% of the service tax demand in each case within eight weeks - Partial stay granted.
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2015 (12) TMI 1271 - CESTAT CHENNAI
Waiver of pre deposit - business auxiliary service - reimbursement of expenses - Held that:- There was no direct nexus between the incentive received and the service provided. It is noticed that in the case of M/s. Agronaut Logistics (India) Pvt. Ltd. Vs. Commissioner of Service Tax, Chennai by the appellant was heard on Monday, Tribunal prima facie opined that appellant therein had not acted as an agent on behalf of the freight forwarding service provider. It acted independently like a service provider in railway tender to rent luggage bogies. This, prima facie, convinces that the appellant has acted on principal to principal basis at arms length. - prima facie case tilting balance of convenience in favour of the appellant, without expressing any opinion at this stage, there shall be waiver of predeposit during pendency of the appeal. - Stay granted.
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2015 (12) TMI 1270 - PUNJAB & HARYANA HIGH COURT
Validity of Tribunal's order - Intellectual Property Right service - Penalty u/s 77 & 78 - Held that:- Tribunal on prima facie of the agreement dated 20.12.2006, came to the conclusion that there was a strong prima facie case in favour of the assessee as there was permanent transfer of intangible goods from the Swedish entity to the assessee and, thus, transaction falls outside the scope of Section 65(55b)(a) of the 1994 Act. Thus, the Tribunal finding strong prima facie case in favour of the assessee granted waiver of pre-deposit in full and stayed all further proceedings for realization of the adjudicated liability during the pendency of the appeal. The appeal before the Tribunal raises a debatable issue - No illegality or perversity could be pointed out by the learned counsel for the appellant in the findings recorded by the Tribunal which may warrant interference by this Court. Accordingly, no substantial question of law arises in this appeal - Decided against Revenue.
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2015 (12) TMI 1269 - CESTAT MUMBAI
Denial of CENVAT credit on photography / validation service, transit insurance service and insurance service - Nexus with manufacturing activity - Held that:- as regards the “transit insurance” and “insurance service”, these are in respect of finished goods and goods exported which are manufactured and within the factory in respect of business of manufacture. If that so, these services are used by the appellant for his business activity. In my considered view the judgement of the Hon'ble High Court of Bombay in the case of Deepak Fertilizers & Petrochemicals Corpn. Ltd. - [2013 (4) TMI 44 - BOMBAY HIGH COURT] will squarely cover the issue in favour of the assessee.
As regards the service tax credit availed on photography/ validation service at site, I find that these services were availed by appellant for installation of equipments/machineries on the site and to ascertain the same in the consonance of the design and drawing submitted by their clients. It is recorded by the lower authorities that the appellant had specifically mentioned that these amounts of service tax are included in the cost of final product, though being undertaken at the site but are in respect of business activity. I find this Bench in the case of Reliance Industries Ltd. [2015 (11) TMI 100 - CESTAT MUMBAI] has relying upon the judgement of the Hon'ble High Court in the case of Ultratech Cement, held any amount which has been accounted as an expenses and considered in costing of final products, credit should be allowed - impugned order denying CENVAT credit is incorrect and liable to be set aside - Decided in favour of assessee.
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2015 (12) TMI 1268 - CESTAT NEW DELHI
Denial of CENVAT Credit - input service - Clearance of goods from factory gate - Held that:- The fact is that the ownership of the goods and the risks related thereto remain with the respondent at least up to the loading of the goods on the ship at the port of shipment. Section 4 of the Central Excise Act, 1944 inter alia states that the place of removal is "any other place from where the excisable goods are to be sold after the clearance from the factory". Thus, the place of removal is in case of export goods in the port of shipment. The CHA services are utilised by the respondent before the goods were loaded onto the ship. The decision of Ultra Tech Cement (2007 (3) TMI 738 - CESTAT AHMEDABAD) cited by Revenue only states that "prima facie there for services beyond the stage of manufacture and clearance of goods from the factory could not be input services". It is evident that CESTAT had only given a prima facie view in the case of Ultra Tech Cement (supra) and therefore the said judgement has no value as a precedent. - no merit in Revenue's appeal - Decided against Revenue.
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2015 (12) TMI 1222 - CESTAT MUMBAI
Demand of service tax on advances received - whether advances received by the appellant from their customers for contracts executed for customers are leviable to Service Tax - Held that:- Account books of the appellant indicate that the advance received is shown as current liability and not as income towards sale/provision of service. Therefore it is not towards value of services provided. The advance is proportionately transferred to sale/confiscation of service in the books as and when the appellant raised invoices on the customers. We find that the order of Commissioner is silent in this respect. The advance is only an amount given as kind of earnest money and for which the appellant gives a bank guarantee to the customers of equal amount. It is more in the nature of a deposit - advance is like earnest money for which a Bank Guarantee is given by the appellant. It is a fact that the customer can invoke the Bank Guarantee at any time and take back the advance. Hence the appellant does not show the advance as an income, not having complete dominion over the amount and therefore the same cannot be treated as a consideration for any service provided. Therefore the findings lack appreciation of the complete facts and evidences. - advance is not received towards taxable service. The advance is the customer's obligation as his part of the mutual commitment between the two parties to honour the terms of the contract.
In respect of some customers, the invoices are not issued for periods ranging upto two years after receipt of advances. The defence of the appellant is that these amounts are shown as current liability in their books of accounts and no services have been provided as yet by them. The Commissioner neither refers to these details nor gives any findings on this issue. Therefore we find no reason to disbelieve the statement of the appellant and take it that the Commissioner too does not dispute this fact. In any case it is on record now that the appellant have paid service tax on the unadjusted advances in July 2011. - impugned order has no merits and is liable to be set aside - Commissioner, in the adjudication order, did not dispute the fact that the service tax was paid periodically on invoice value and that the advance was adjusted in each invoice reducing the outstanding amount correspondingly. The Commissioner only determined that service tax is payable on the advances. We have already expressed our view that the service tax was not required to be paid on the advances and further when the amounts of advance were adjusted proportionately in the invoices and service tax was paid on the invoice value. - impugned Order is set aside - Decided in favour of assessee.
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2015 (12) TMI 1221 - CESTAT MUMBAI
Demand of service tax - Export of Business Auxiliary Service - Held that:- Order of the Commissioner wherein after analyzing the services provided, he has came to the conclusion that both conditions of Export of Services are satisfied. He has also relied on clarification issued by the Ministry vide Circular No. 111/5/2009-ST dated 24/2/2009. The said circular clarifies at Sr. No. (iii) that taxable services shall be treated as Export of Services if “Indian agents who undertake marketing in India of goods of a foreign seller. In this case, the agent undertakes all activities within India and received commission for his services from foreign seller in convertible foreign exchange”. - issue stands decided by the Tribunal in their own case reported in [2008 (3) TMI 32 - CESTAT BANGALORE] - Decided against Revenue.
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2015 (12) TMI 1220 - CESTAT CHENNAI
Waiver of pre deposit - CENVAT Credit - reverse charge mechanism - technical consultancy service received from abroad - Held that:- Examining the taxability and non-taxability, it transpires that the advance returned not being taxable, for the time being the interest demand may not be enforceable. Similarly, utility service charges received being payable to the respective authorities providing such service, there may not be enforceable demand for the time being. So far as reverse charge mechanism applicable in respect of demand of ₹ 34,292/- is concerned, that is good demand for recovery at present. Similarly, the CENVAT credit wrongly availed appears to be a credible ground for Revenue for recovery at this stage. Thirdly, the interest paid for default period for payment of service tax to the extent of ₹ 23,31,736/- is also a good demand for recovery at present. - Partial stay granted.
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2015 (12) TMI 1219 - CESTAT CHENNAI
Waiver of pre deposit - Exemption under Notification No.14/2004, dated 10.09.2004 - Held that:- there shall be waiver of pre-deposit during pendency of the appeal - No doubt, the notification above grants benefit in respect of services listed in section 65 (19) of the Finance Act, 1994, but with the rider that service of the nature appearing therein should be provided in relation to agriculture, printing, textile processing or education to claim service tax exemption. It appears to the commonsense that printing industry is envisaged to enjoy tax exemption when if that is labour intensive without being highly sophisticated or mechanized. However, we do not express any opinion on merit at this stage. - Stay granted.
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2015 (12) TMI 1218 - CESTAT CHENNAI
Supply of tangible goods service - whether without any effective control and transfer of ownership which are essential ingredient of section 65 (105)(zzzz) of Finance Act, 1994, there shall be taxability under the shelter of provision of services in relation to supply of tangible goods - Held that:- Prima facie, interpretation of law is involved in this case with the bundle of facts including contract documents touching the same. In respect of similar nature of transactions Tribunal in the case of Petronet LNG Ltd. Vs Commissioner of Service Tax, New Delhi [2013 (11) TMI 1011 - CESTAT NEW DELHI], has held no taxability. However, without prejudice to the contentions of both sides at this stage there shall be waiver of pre-deposit during pendency of the appeal. - stay granted.
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2015 (12) TMI 1217 - CESTAT CHENNAI
Waiver of pre deposit - Erection, Commissioning and installation service - doubt was whether the abatement were genuinely claimed - Held that:- Prima facie, there were four contracts executed by the appellant. But contract-wise discussion is absent in the Adjudication order to appreciate the quantum of goods if any used in each contract. Learned Adjudicating authority in para 12.1 of the order has recorded that there was a claim of abatement. But his only doubt was whether the abatement were genuinely claimed and benefit of the notification by the appellant was appropriate. Appellant failed to satisfy the authority on this aspect. However, prima facie making overall assessment of the fact situation and denial of abatement not being on sound reasoning, there shall be waiver of pre-deposit during pendency of the appeal. - Stay granted.
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