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Service Tax - Case Laws
Showing 201 to 220 of 31546 Records
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2025 (6) TMI 447
Refund of service tax paid under protest - time limitation - refund was rejected on the ground that the refund claim was filed after one year from the date of payment of service tax - HELD THAT:- The learned Commissioner has passed order-in-original in his capacity as adjudicating authority. The order passed by the adjudicating authority cannot be considered as an order passed by appellate authority or Appellate Tribunal. Clause (ec) provides for relevant date to be the date on which appellate authority or Appellate Tribunal passed the order. In the present case, Appellate Tribunal passed order on 27.10.2021 as a result of which refund became consequential. The grounds raised by Revenue are not tenable.
Conclusion - The refund claim was timely filed within one year from the date of the appellate order.
The appeal filed by Revenue is dismissed.
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2025 (6) TMI 446
Non-payment of service tax - jurisdiction of Assistant Commissioner of CGST to issue the SCN and pass orders relating to service tax liability under the repealed Finance Act, 1994 - Scope of the definition of ‘State’ under Article 12 - exemption under N/N. 25/2012-ST dated 20.6.2012.
Jurisdiction of Assistant Commissioner of CGST to issue the SCN or to pass an order in respect of service tax - HELD THAT:- The challenge of the jurisdiction of the Assistant Commissioner by the learned counsel is an account of the fact that he had not considered the savings clause of the CGST Act. If the learned counsel’s submissions are accepted, it will result in utter chaos and confusion. For instance, if any assessee succeeds in service tax appeal and has to get consequential relief, if the CGST officers are held to be not authorised under Service Tax law, nobody can grant refund to the assessee because there are no more any service tax officers. This submission of the learned counsel on the question of jurisdiction deserves to be rejected and is rejected.
Scope of the definition of ‘State’ under Article 12 - HELD THAT:- It is meant for only Part III (Fundamental Rights) of the Constitution and that too unless the context otherwise requires. This part deals with the fundamental rights and places certain restrictions on what the State cannot do and for this purpose, the definition of ‘State’ shall be as per Article 12. This definition does not apply even to other parts of the Constitution itself, for instance, Part VI which deals with the States. Nothing in Article 12 suggests that it would apply to all laws and notifications in the country. Learned counsel placed the definition in Article 12 completely out of context. In this appeal, the dispute is about the liability of tax. There no is dispute about or interpretation of any fundamental rights. This submission of the learned counsel due to his misunderstanding of the scope of Article 12 needs to be rejected.
Exemption under N/N.25/2012-ST [S.No. 12 (a)] - HELD THAT:- The notification exempts services by way of construction of a civil structure or any other original works meant predominantly for use other than for commerce, industry or any other business or profession. The three structures viz., the auction platforms and the roofs over the internal roads were constructed in mandis or market places. There cannot be any doubt that these structures are meant for business and commerce. Mandis or market places are meant for business only and nothing else. To suggest that these are not meant for business or commerce is preposterous. Therefore, the services received by the appellant are clearly not covered by S.No. 12(a) of Notification no. 25/2012-ST.
S.No. 14(d) of the notification - HELD THAT:- Market is not a place of storage but a place where goods are sold and bought. Of course, when they are to be sold, they will be brought to the market and until they are sold, they are kept in the market but that does not make the market a place of storage. The auction platform, for instance, as the name suggests, is for auctioning the produce. Simply because the produce is kept on the platform until it is sold, the platform does not become a place of storage. Similarly, internal roads of mandis are meant for movement of goods and vehicles carrying them. Vehicles may stop on these roads until they are unloaded but that does not make the roads a place of storage. Clearly, nothing in S.No. 14(d) of the notification applies to the services received by the appellant.
Extended period of limitation - HELD THAT:- In this case, the appellant had not registered with the service tax. Neither the appellant nor the service provider had declared the services which the appellant had received. Even after the investigation was commenced, the appellant had not made any effort to pay the service tax due from it. The appellant was waiting until the service tax officers got the intelligence, investigated and knocked at the appellant’s door. Nothing in the entire conduct of the appellant shows that it behaved like a responsible government entity with no intent to evade service tax. In this factual matrix, the extended period of limitation has been correctly invoked.
There are no reason to interfere with the confirmation of demand invoking extended period of limitation under section 73 with appropriate interest under section 75 - Section 77 of the Finance Act provides for penalty for not filing the returns. Admittedly, the appellant had neither paid the service tax nor filed the returns. The penalty under section 77 therefore, deserves to be upheld.
Appeal dismissed.
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2025 (6) TMI 445
Demand barred by time limitation or not - demand for service tax for the period prior to 1.10.2013 - Demand of service tax on sale of space for advertisements - Demand of service tax said to have been collected from the client departments and not deposited - Demand of service tax on service charges collected for printing.
Demand barred by time limitation or not - demand for service tax for the period prior to 1.10.2013 - HELD THAT:- Demand invoking extended period of limitation can be invoked only if the non-payment or short payment of service tax is by virtue of fraud, collusion, wilful mis-statement or suppression of facts or violation of the provisions the Act or Rules with an intent to evade paying service tax. Similar provisions were in the Central Excise Act,1944 and the Supreme Court in Nizam Sugar Factory [2006 (4) TMI 127 - SUPREME COURT] held that when the facts are known to both sides, the assessee cannot be alleged to have suppressed the facts and extended period of limitation could not be invoked.
In this case, there is no dispute that the appellant was registered with the service tax department and had been self- assessing service tax and filing returns. If the returns are filed, it is the responsibility of the officer to scrutinize them and for this purpose, he can also call for any records and scrutinize them. If the officer failed to do so and if some tax escapes assessment and it is later discovered by the audit, the fault lies at the doorstep of the officer. The negligence of the officer cannot be called suppression by the assessee - the ratio of Nizam Sugar Factory squarely applies to this case and the demand for extended period of limitation cannot be sustained.
Since the normal period of limitation is only from 1.10.2013, only the provisions applicable to the post negative list regime (from 1.7.2012) would apply.
Demand of service tax on sale of space for advertisements - HELD THAT:- The entire demand in this case is of service tax on sale of space for advertisements prior to 2014 and the appellant had been paying service tax from 2014. If that be so, the demand on this count cannot be sustained and needs to be set aside subject to verification by the Commissioner.
Demand of service tax said to have been collected from the client departments and not deposited - HELD THAT:- The Commissioner did not agree with this submission in the impugned order for the reason that the appellant had not produced evidence that the amounts were paid to the empanelled agencies. Learned Chartered Accountant for the appellant submitted before us voluminous documents to substantiate his assertion that the amounts collected as service tax were paid to the empanelled agencies - it would be appropriate for the Commissioner to verify the documents. To the extent the amounts have been paid to the empanelled agencies, no service tax can again be demanded from the appellant. If any amount collected as service tax has not been deposited as service tax or paid to the empanelled agency, such amount alone, needs to be deposited as per section 73A of the Act.
Demand of service tax on service charges collected for printing - HELD THAT:- What is exempted under this notification is any intermediate production process as job work in relation to printing. What the appellant did is not a job work. It had contracts from the client departments contracts for getting the brochures, manuals, etc. printed. It engaged someone else to do the job of printing after preparing content using its in-house expertise. The appellant was, by no stretch of imagination a job worker to a printer. The printer, in fact, was the appellant’s sub- contractor. Therefore, the appellant’s service is clearly not covered by this exemption notification. The appellant is liable to pay service tax on the service charges which it had collected from the client departments towards printing work but only within the normal period of limitation.
Conclusion - i) The demand for extended period of limitation and the penalty under section 78 of the Act are set aside. ii) The demand of service tax on selling of space for advertisements is payable only after 2014 and according to the appellant, the entire demand under this head is for the period before 2014. The demand is accordingly set aside subject to verification by the Commissioner. If any part of the demand in the impugned order under this head pertains to the post 2014 period, the demand is upheld to that extent. iii) The demand of amounts said to have been collected as service tax from the client departments and not deposited need not be deposited to the extent they were merely collected and paid to the empanelled agencies. The Commissioner may verify the documents for the purpose. The appellant shall submit all documents to the Commissioner within four weeks from the date of this order. iv) Service tax on service charges on printing collected in the post negative list is upheld.
The appeal is partly allowed and is remanded to the Commissioner solely for verification and computation.
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2025 (6) TMI 444
Negative listed services or not - amount received as discount and incentive from M/s Hyundai Motors India Limited and M/s Mobis India Ltd. (manufacturer) against the sale of motor vehicle/spare parts - invocation of extended period of limitation - HELD THAT:- The decision of M/s Roshan Motors [2022 (8) TMI 1254 - CESTAT NEW DELHI] has been consistently followed in the decisions relied upon by the appellant. It is held that 'the activity of receiving the incentives/discounts is as good as a part of trading activity and cannot be called as service as is defined under Section 65B(44) of the Finance Act.'
Invocation of extended period of limitation - HELD THAT:- There is nothing on record produced by the department to prove the alleged suppression. Hon’ble Supreme Court in the case of Collector of Central Excise Vs. HMM Limited [1995 (1) TMI 70 - SUPREME COURT] has held that inference of intention to evade payment of duty is not drawable automatically. The show cause notice must contain an averment to that effect pointing out specifically as to which of the various acts or omissions stated in the act have been authority must specifically deal with assessee’s contention in rebuttal thereof. In the present case there is no such finding in the Order-in-Original except assuming that the amount in question is received by the appellant for rendering a taxable service. No such act is discussed which may amount to an act of suppression or concealment - The show cause notice is therefore held to be barred by time.
Conclusion - There was no service tax liability upon the appellant nor any alleged suppression has been committed by them. The show cause notice which has invoked almost five years period while raising the impugned demand is therefore held to be barred by time.
Appeal allowed.
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2025 (6) TMI 443
Levy of pay Service Tax - Security Agency service for the period 2006-07 to 2011-12 - appellant, a police department providing security services to scheduled banks and government organizations on a cost-recovery basis - HELD THAT:- As per the clarification vide Circular issued dated May 20, 2011, there was confusion as appellant was of the view that they were performing sovereign function of providing security service which is in nature of statutory obligations and clarification came only on May 20, 2011.
In that circumstances, for the period prior to 20th May, 2011, the appellant is not liable to pay Service Tax as held by this Tribunal in the case of The Deputy Commissioner of Police Jodhpur, Superintendent of Police versus Commissioner of Central Excise and Service Tax, Jaipur, [2016 (12) TMI 289 - CESTAT NEW DELHI] wherein this Tribunal observed that 'police department, which is an agency of the State Govt., cannot be considered to be a person engaged in the business of running security services. Consequently, the activity undertaken by the police is not covered by the definition of Security Agency under Section 64(94) of the Act.'
Conclusion - Following the decision in the case of Deputy Commissioner of Police Jodhpur, Superintendent of Police, it is held that no Service Tax is payable by the appellant during the impugned period. Consequently, no penalty can be imposed on the appellant.
The impugned order is set aside - appeal allowed.
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2025 (6) TMI 442
Liability of appellant to pay service tax - execution of flood lighting work executed along the Indo-Bangladesh border - sub-contractors executing the work under NPCC are liable to pay Service Tax under the category of Erection, Commissioning or Installation Services or Works Contract Services - HELD THAT:- The main appellant namely NPCC was entrusted with the execution of flood lighting work along the Indo-Bangladesh Border within the state of Tripura & Meghalaya for which NPCC had executed Memorandum of Understanding(s) with the Ministry of Home Affairs and the contract was executed on “Deposit Basis” as per CPWD norms, and NPCC acted only as an executing agency and supervisory body. Therefore, no demand of Service Tax is sustainable against NPCC in terms of Circular No. 125/7/2010-ST dated 30.07.2010 - Admittedly the appellant NPCC is only an implementing agency for Central Government therefore, no Service Tax is payable by NPCC.
With regard to co-appellants, it is admitted fact that the work has been executed being a sub-contractor of NPCC which include supply of material and the said issue has been examined by this Tribunal, whether in this circumstances the appellant are liable to pay Service Tax or not wherein this Tribunal has observed 'the demand if any could have been raised under the Works Contract Service. The demand in this case has been made under Erection, Commissioning and Installation Service. ECIS does not include the contract where transfer of materials is involved. Since the demand has been raised under ECIS and the nature of contract does not fall under this category, the demand on this head it has to fail.'
Admittedly, in the matter in hand the appellants have executed works alongwith material, therefore, merit classification of their services “Works Contract Service” as held by the Hon'ble Apex Court in the case of Larsen and Toubro Ltd. [2015 (8) TMI 749 - SUPREME COURT] wherein it has been held that where the contract in question is a composite contract involving both supply of goods and provision of services in relation to construction or infrastructure projects, such contracts must be assessed under the category of “Works Contract Service”. As in these cases, Service Tax has been demanded under the category of “Erection, Commissioning or Installation Services” (ECIS) whereas the correct classification involves in Works Contract Service, in that circumstances, the demand of Service Tax under the category of Erection, Commissioning and Installation Services is not sustainable.
Conclusion - Demands confirmed against the appellants under the category of Erection, Commissioning or Installation Services are set aside. As no demand is sustainable, consequently, no penalty can be imposed against the appellants.
The impugned order set aside - appeal allowed.
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2025 (6) TMI 441
Liability of appellant to pay service tax on the supply of water by the Government of Odisha - HELD THAT:- The said issue has been examined by this Tribunal in the case of M/s Indian Oil Corporation Limited [2024 (10) TMI 1129 - CESTAT KOLKATA], wherein this Tribunal has observed 'As issue has already been settled by the decision of this Trbunal for water supply by Government of Odisha, the appellant is not liable to Service Tax.'
Conclusion - As the issue has been settled that for water supply given to the Government of Odisha, the appellant is not liable to pay service tax, following the decision of the of this Tribunal in the case of Indian Oil Corporation Limited, the appellant is not liable to pay service tax on water supply to the Government of Odisha.
Appeal allowed.
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2025 (6) TMI 361
Challenge to demand notices and SVLDRS-3 forms issued by the respondents, which changed the petitioner's category from investigation to arrears and increased the tax liability - time limit prescribed under Section 127(5) of the Finance Act, 2019 - HELD THAT:- A perusal of the impugned order would indicate that the sole ground on which the case of the petitioner has been rejected by the respondents is that the scheme had come to an end. However, in light of the judgment of the Hon’ble Supreme Court with regard to the extension of limitation referred to herein above and the coupled with the fact that the judgments rendered by the Hon’ble High Courts of Madras, Bombay, Gujarat and Delhi, granting benefits of SVLDRS in favour of the petitioner/assessee therein on the ground of the prevailing COVID-19 pandemic, even cases where payments were made subsequent to 30.06.2020, the impugned order rejecting the case of the respondents cannot sustain and deserves to be quashed and necessary directions are required to be issued to the concerned respondents to accept the payment made by the petitioner and issue discharge certificate in its favour.
The aforesaid conclusion is based upon the objective of the SVLDR scheme, which had been introduced by the Central Government, as a one time measure for liquidation of past disputes of central excise and service tax, the SVLDR scheme had also been issued to ensure disclosure of unpaid tax by an eligible person. This appears to have been associated as the levy of central excise and service tax had now been subsumed in a new GST Regime - As an incentive, those making the declaration and paying the declared tax verified as determined in terms of the scheme would be entitled to certain benefits in the form waiver of interest, fine, penalty and immunity from prosecution. This is the broad picture the concerned authorities were required to keep in mind while dealing with a claim under the scheme.
On the facts of the present case, denying the benefits of SVLDR Scheme would not only contrary to object of the scheme but also would also be injustice to the petitioner declarant who otherwise was eligible.
Whether the provisions under the Finance Bill with regard to the fixation of time limit for availing the benefit of scheme and with regard to extension of time for making payment of tax are directive in nature? - HELD THAT:- This precise question has been considered by the learned Single Judge of Madras High Court in N. Sundarajan vs. Union of India & Ors., [2023 (11) TMI 899 - MADRAS HIGH COURT], wherein the scheme was held to be directive.
This Court is of the considered view that the petitioner deserves to be granted another chance to make the payment after associating it so as to arrive at the amount due payable.
Conclusion - The petitioner is entitled to have its tax liability recalculated under the Scheme, to make payment beyond the original deadline in view of the pandemic, and to receive the discharge certificate.
Petition disposed off.
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2025 (6) TMI 360
Levy of service tax - port services, cargo handling services, and Goods Transport Agency (GTA) services - ELD THAT:- The authorities below should have refrained from passing an order in the remand proceedings when the issue was under consideration by the Tribunal. This is a serious disregard to judicial discipline. The appellants have been subjected to repeated proceedings on the same issue which is decided by the Tribunal in the appellant’s own case and in respect of the very same proceedings.
The Bench in M/S. ASPINWALL & CO. LTD. VERSUS THE JOINT COMMISSIONER OF SERVICE TAX, CHENNAI [2018 (8) TMI 330 - CESTAT CHENNAI] takes serious note of the same and cautions the authorities against any recurrence in this regard. Coming to the merits of the case, it is found that, the issue being already decided by this Bench, the impugned proceedings are infructuous as far as merits and consequences are concerned. However, for the sake of record, the impugned order is set aside and the appeal is allowed with consequential relief, if any, as per law.
Conclusion - i) The demand for service tax on port services was set aside. ii) The demand on cargo handling and GTA services was upheld but was already complied with by the appellant. iii) Penalties imposed on the appellant were set aside.
The impugned order is set aside - appeal allowed.
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2025 (6) TMI 359
Levy of service tax - banking and financial services - appellant is collecting various fee in the form of processing fee, sale of passbook, consultancy fee, admission fee, documentation fee, risk fund fee etc. from the borrowers - HELD THAT:- It is seen that in order to qualify as a “banking company” or “financial services” company, the entity has to be recognized by Reserve Bank of India and proper license has to be obtained from RBI. In the present case, the Department has not brought in any evidence to the effect that the appellant was issued such license by Reserve Bank of India. Prior to 30.06.2012, the Service Tax demand has to be quantified on a particular specific head. In the present case, the demand has been made under the specific heading of Service Tax payable under “Banking and Financial services”.
The appellant does not fall under the category of “banking or financial institution” at all during the period 2008 to 30.06.2012. Therefore, on this ground itself, the demand for the period 2008-09 to 30.06.2012 does not survive. Accordingly, we set aside the demand for this period on merits.
From the definition of Interest, it can be seen that the Service Tax exemption is granted only for “interest” as specified above. Other “service fee” and “other charges” in respect of monies borrowed or debt incurred are not termed as ‘interest’. Therefore, we do not subscribe to the view of the appellant that ‘admission fee’ and ‘other charges’ which are being levied on the borrower will fall under the category of ‘interest’ after 1.7.2012. Accordingly, we hold that the demand for the period 1.7.2012 to 31.3.2013 is required to be affirmed. It is found that the entire demand for 2012-13 is within the normal period. Therefore, it cannot be considered that the appellant's submissions on account of time bar.
Conclusion - The appellant is required to pay the service tax for the period 1.7.2012 to 31.3.2013. Interest is also required to be paid by the appellant in terms of Section 75 of the Finance Act, 1994. Considering the fact that the entire issue is that of interpretation and the bulk of demand has been set aside on merits for the period 2008-09 to 2012, we hold that no case of suppression has been made out against the appellant. Accordingly, the entire penalties imposed on the appellant set aside.
Appeal allowed in part.
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2025 (6) TMI 266
Calculation of service tax - reimbursements of various expenses claimed by the appellant from the service recipient - conditions prescribed under Rule 5 of Service Tax (Determination of Value) Rules, 2000 have not been satisfied - pure agent services or not - HELD THAT:- The conditions of the impugned order is in view of Rule 5 of the Service Tax (Determination of Value) Rules, 2000. It is found that the Hon'ble Supreme Court has struck down the said Rule in the case of Intercontinental Consultants and Technocrats Pvt. Ltd. [2018 (3) TMI 357 - SUPREME COURT].
Such reimbursements are not taxable service as by no way of imagination they can be linked to any conservation for such service rendered.
The impugned order is set aside and the appeal is allowed.
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2025 (6) TMI 265
Liability of appellant to pay service tax on the charges collected from the member units for the activity of treatment of effluent water - Business Auxiliary services or not - HELD THAT:- The Appellant is an entity created to construct and operate a Common Effluent Treatment Plant in accordance with the Guidelines of Ministry of Environment & Forests & Tamil Nadu Pollution Control Board, and that all the Directors of the tanneries functioning at SIPCOT, Perundurai are the members of this entity. The Original Adjudicating Authority has held that demand raised in this appeal was pertaining to Business Auxiliary Service and not club or association service to justify the denial of the benefit of the above exemption. However, the common effluent treatment plant setup in order to collect and treat the effluent water and send back to treated water to the units collecting consideration satisfies the project referred to in the above statutory provision. Due to this retrospective exemption accorded for the setting up and operation of Common Effluent Treatment Plant, the demand raised for service tax is not sustainable for the period upto 30.06.2012. Even for the period after from 01.07.2012 onwards, the activity of the Appellant has been exempted from the levy of service tax vide Notification No. 8/2017-ST dated 20.02.2017.
The activity of Common Effluent Water Treatment is exempted from payment of service tax in terms of Section 145 of the Finance Act, 2012 retrospectively from 16.06.2005 onwards till 2012 and thereafter under exemption Notification No. 8/2012-ST dated 20.02.2017 from 01.07.2012 to 31.03.2015.
Reference made to decision rendered in the case of M/s. Odyssey Organics Pvt. Ltd. Vs. Commissioner of Central Excise, Raigad [2016 (11) TMI 584 - CESTAT MUMBAI] wherein it was held that the treatment of effluent waste cannot be considered as processing of goods by any stretch of imagination and so not taxable under Business Auxiliary Service.
Conclusion - The services rendered by entities operating government-subsidized common effluent treatment plants qualify as exempt "club or association" services under Section 145, and such activities do not fall within the ambit of Business Auxiliary Service for service tax purposes. The retrospective exemption and subsequent Notification No. 8/2017-ST shield such activities from service tax liability for the relevant periods.
The appeal is allowed.
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2025 (6) TMI 264
Rejection of department’s appeal without going into the merits of the case only on the ground that the Review Order/Direction Order dated 13.02.2023 has not been passed within the time limit prescribed under Section 84 of FA - HELD THAT:- In view of the facts, the impugned order, dismissing the appeal of the department only on the ground that there is a delay in passing the Review Order/Direction Order, is not sustainable in law. More so when the appeal filed by the department before the Commissioner (Appeals) is within the time limitation as prescribed under the rules, therefore, we set aside the impugned order and remand the matter back to the learned Commissioner (Appeals) with a direction to decide the appeal on merits after following the principles of natural justice and thereafter, pass a reasoned order in accordance with law within the period of three months from the date of receipt of the certified copy of this order.
The appeal is allowed by way of remand.
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2025 (6) TMI 263
Refund of service tax paid on services related to the export of iron ore fines - rejection for non-compliance of conditions envisaged in Notification No.41/2007-ST dated 06.10.2007, as amended - non-compliance of condition (iii) in column 4 of entry no.11 of the Schedule appended to Notification No. 03/2008-ST dated 19.02.2008 - HELD THAT:- Similar issue has been examined by this Tribunal in the case of S.K.Sarawagi Company Private Limited [2023 (2) TMI 481 - CESTAT KOLKATA], wherein this Tribunal has observed 'Though the above clarification was with respect to Notification No. 5/2006-C.E. (N.T.) but it clearly conveys that in budget 2009 the scheme under Notification No. 41/2007-S.T. was simplified in Notification No. 17/2009-S.T. by providing self certification or Chartered Accountant’s certification about co-relation and nexus between input Services & the exports. That above logic can be followed for Notification No. 5/2006-C.E. (N.T.) where such simplification of Notification No. 17/2009-S.T. may not be available.'
Following the decision of the case of S.K.Sarawagi Company Private Limited, it is held that in case of bulk cargo, the goods are to be aggregated at the port premises even before the shipping documents are prepared. The export invoices are prepared only after the iron ore fines are loaded in the vessel as per the contractual terms and conditions and factors, like quality, size, etc., which are variable. Therefore, the compliance of condition No.11 of N/N. 3/2008 dated 19.02.2008 should be ascertained by broadly correlating the evidence of transport and service tax paid on such transport charges and quantity exported. In view of this, the appellant has complied with the condition of Notification No.3/2008 dated 19.02.2008.
Conclusion - The appellant has complied with the condition of Notification No.3/2008 dated 19.02.2008, thus refund is allowed.
The impugned orders are set aside - Appeal allowed.
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2025 (6) TMI 191
Levy of service tax under Reverse Charge Mechanism - commission paid to the foreign agents and the rent paid to the Director of the company - entire exercise is revenue neutral in view of availability of Cenvat credit - Rent paid on godowns to the Director of the Company - invocation of extended period of limitation.
Levy of service tax under Reverse Charge Mechanism - commission paid to the foreign agents and the rent paid to the Director of the company - entire exercise is revenue neutral in view of availability of Cenvat credit - HELD THAT:- The issues raised are no more res integra and has been decided by this Tribunal and also by the Apex Court. Reliance placed by the learned counsel on the decision in Texyard International Vs. CCE [2015 (8) TMI 794 - CESTAT CHENNAI], where the issue related to the demand of service tax under reverse charge on the commission paid to the Overseas agents for export of finished goods. The Tribunal took the view that the service tax, if any, payable under reverse charge is permissible to be availed as Cenvat credit and that may be refundable under Notification No.41/2007. Further, relying on the decision in CCE Vs. Coca Cola India Pvt. Ltd. [2007 (4) TMI 17 - SUPREME COURT], where the Apex Court accepted the submission of the learned counsel for the assessee that the consequences of payment of excise duty after availing Modvat credit was revenue neutral, the demand of service tax under reverse charge was set aside on the principle of revenue neutrality.
In view of the consistent stand taken by the Tribunal, it is found that the demand of service tax on the amount of commission paid to the foreign agents for booking of export orders is not maintainable on the principle of revenue neutrality as in the event of charging service tax, the appellant would be entitled to Cenvat credit. Therefore, the demand on this account is not maintainable.
Rent paid on godowns to the Director of the Company - HELD THAT:- The Tribunal in the case of Cords Cable Industries Ltd. Vs. CCE, Jaipur [2023 (4) TMI 441 - CESTAT NEW DELHI] have decided the said issue in favour of the appellants observing that the Directors provided the service of renting of immovable property in their individual capacity as owners of the premises and not as the Directors of the appellant. Hence in such a situation, it was held that the appellant could not have asked to pay service tax on reverse charge mechanism - no service tax is leviable on the rental amount paid to the Director of the Company, as the same was paid to him in his individual capacity as the owner of the godown. The demand on this account is accordingly set aside.
Extended period of limitation - HELD THAT:- Since the issue decided on merits in favour of the appellant with regard to the demand of service tax on both the counts, it is not necessary to go into the issue of limitation for invoking the extended period, although this Tribunal has held that in case of revenue neutrality, the extended period of limitation cannot be invoked.
There are no merits in the impugned order and hence, the same is hereby set aside - appeal allowed.
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2025 (6) TMI 190
Irregular availment of CENVAT Credit - CENVAT Credit was availed on documents which were not raised against them and credit was availed on the basis of documentation which appeared to have no mention of Service Tax - HELD THAT:- In this case, the disputed period is from 2004-05 to 2008-09 and the impugned Show Cause Notice was issued, by invoking the extended period of limitation, on 11.04.2012, on the basis of audit conducted on 18.04.2011. The appellant has already reversed the CENVAT Credit of Rs.26,94,123/- and agreed before the ld. adjudicating authority that the demand may be limited to that amount. It is observed that the said amount has been paid by the appellant, along with interest, and paid a penalty of Rs.8,65,439/-. Therefore, such payment made by the appellant is sufficient to meet the ends of justice in a case where the admitted demand has been paid by the appellant along with interest and 25% of penalty on that.
Conclusion - The admitted portion of the demand, which has already been paid by the appellant, is upheld, which is sufficient to meet the ends of justice - rest of the demand set aside.
Appeal disposed off.
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2025 (6) TMI 189
Levy of service tax under the category of “renting of immovable property” service - Rents collected from shops by the Municipal Corporation through their circles - Rents collected from shops of / by Patna Regional Development Authority - Payment received from lease - Payment received from Licence Fee of Mobile Towers - Payment received from any other type of Rent and Licence Fee - Payment received as rent from Bus Terminal [ISBT (Inter State Bus Terminal) daily collection] - levy of late fees.
Rent collected from shops / stalls during the impugned period - HELD THAT:- The appellant has accepted this demand and it is not being contested in this appeal. Therefore, the appellant is liable to pay the above demand of Service Tax, along with interest, if not already paid. However, it is observed that the appellant has not suppressed any information from the department and hence intention to evade payment of Service Tax cannot be attributed to the appellant. For this reason, no penalty is imposable on the appellant in respect of this demand confirmed and upheld along with interest.
Rent collected from Guest Houses / shops and Space / Kiosks / Stalls / Grounds / Telephone Booths of Patna Regional Development Authority (PRDA) (presently merged with PMC) - HELD THAT:- The appellant has accepted their service tax liability on this count. Hence, the above demand of Service Tax, along with interest is upheld, and the same is liable to be paid, if not paid already. However, since there is no intention on the part of the appellant to evade payment of Service Tax, no penalty is imposable on this count.
Demand has been raised on the amounts received by the appellant in connection with leasing of shops, which stands squarely covered under the definition of “renting of immovable property” service - HELD THAT:- The definition of “renting of immovable property” service reproduced above, it is observed that 'leasing' of immovable property has been specifically covered in the definition. Accordingly, the demand of Service Tax in this regard is upheld and it is held that the same is payable by the appellant, along with interest. However, there are no reason to impose penalties in respect of this demand confirmed as there is no intention to evade payment of Service Tax established on the part of the appellant on this count.
Licensing Fee from mobile towers received - HELD THAT:- These are in the nature of granting permission to the companies to erect and maintain their mobile towers. Such payments for acquiring the permission cannot be considered as 'rent' to fall within the definition of 'renting of immovable property' service as defined under Section 65(105)(zzzz) of the Finance Act, 1994.
Amount received from Bus Terminal [ISBT (Inter State Bus Terminal)] - HELD THAT:- On examination of the nature of the service rendered in this regard, it is opined that the said activity does not fall within the definition of ‘renting of immovable property’ as it is meant for parking of the buses overnight, as has been pointed out by the appellant. Consequently, there is no liability to Service Tax on the said charges collected by the appellant under the category of 'renting of immovable property service'. Accordingly, the demand of Service Tax confirmed in this regard is not sustainable and hence the same is set aside.
Levy of penalties - HELD THAT:- The demands have been raised only on the basis of the documents maintained and furnished by the appellant. It is observed that the appellant has not suppressed any information and had no intention to evade payment of Service Tax. Accordingly, the penalties imposed on the appellant under Sections 78, 77(1)(a) and 77(1)(c) of the Finance Act, 1994 are not sustainable and hence the same are set aside.
Levy of late fees - HELD THAT:- There were delays in filing the Returns by the appellant and hence we do not interfere with the late fee imposed under Section 70 of the Finance Act, 1994 read with Rule 7(c) of the Service Tax Rules, 1994 for failure to furnish their Returns in time. The same is therefore sustained.
Conclusion - i) The demand of Rs.5,92,679/- on rent collected from shops / stalls is upheld, along with interest. However, no penalty is imposable in this regard. ii) The demand of Rs.1,96,800/- on rent received from Guest Houses / shops and Space / Kiosks / Stalls / Grounds / Telephone Booths of Patna Regional Development Authority (PRDA) is upheld, along with interest. However, no penalty is imposable in this regard. iii) The demand of Rs.56,90,044/- in respect of instalments of lease amount of shops is upheld, along with interest. However, no penalty is imposable in this regard. iv) The demand of Rs.35,29,439/- on Licensing Fee collected for granting permission to erect and maintain the mobile towers set aside. v) The demand of Rs.3,17,141/- is set aside. vi) The demand of Rs.47,11,279/- confirmed on the amount received for parking the buses at the Bus Terminal [ ISBT ( Inter State Bus Terminal )] set aside. vii) The penalties imposed on the appellant under Section 78, 77(1)(a) and 77(1)(c) of the Finance Act, 1994 are set aside. viii) The imposition of late fee under Section 70 of the Finance Act, 1994 read with Rule 7(c) of the Service Tax Rules, 1994 is upheld.
Appeal disposed off.
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2025 (6) TMI 188
Rejection of refund claim filed by the appellant under section 11B of the Central Excise Act, 1944 - rejection of refund on the ground of unjust enrichment - only reason assigned by the Commissioner (Appeals) for holding that the appellant was not entitled to refund of service tax already paid by it is that the appellant was required to pay service tax with effect from 01.07.2012 in view of the provisions of the Finance Act - HELD THAT:- In view of the aforesaid Judgment of the Supreme Court in Calcutta Club [2019 (10) TMI 160 - SUPREME COURT] that deals with the legal position as it existed prior to 01.07.2012 and as it exists w.e.f. 01.07.2012, the finding recorded by the Commissioner (Appeals) that the appellant would be liable to pay service tax on the services rendered by a club to its members w.e.f. 01.07.2012 is not correct. Similarly, reliance placed by the Commissioner (Appeals) on the decisions rendered by the Authority for Advanced Ruling in Emerald Leisures Ltd. [2015 (10) TMI 297 - AUTHORITY FOR ADVANCE RULINGS] and Avadh Infratech Ltd. [2016 (9) TMI 145 - AUTHORITY FOR ADVANCE RULINGS] is mis-placed.
Though the Commissioner (Appeals) has not dealt with issue of unjust enrichment, but the Assistant Commissioner also introduced the theory of unjust enrichment, though without recording reasons.
In Karnavati Club Ltd. vs. Commissioner of Service Tax, Ahmedabad [2013 (5) TMI 752 - CESTAT AHMEDABAD], the Tribunal examined whether the claim of unjust enrichment can be raised against a club when it provide services to its members. It was held that the principle of unjust enrichment would not be applicable.
Conclusion - The Tribunal set aside the impugned order dismissing the refund claim and allowed the appeal.
Appeal allowed.
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2025 (6) TMI 187
Classification of services - Construction of Residential Complex Service or not - construction activities undertaken by the appellant in the form of residential complexes - HELD THAT:- The Show Cause Notice accepts the fact that consideration includes value of land and registration charges. Therefore, the notice hold that duty is payable on 33% of the gross value for consideration.
On going through the Show Cause Notice, it is clear that the agreement / the work undertaken involves sale of goods also and the consideration is not vivisectable. Therefore, the activity falls under works contract service which has come into effect from 1.6.2007. Ld. Authorized Representative submits that the very presence of common area makes the service of construction liable to service tax under ‘Construction of Residential Complexes’. It is found that this logic is not acceptable for the reason that even if the plan for complexes shows presence of common areas / common utilities, it will not take away the composite nature of the service. Merely because the description of the services tallies with the definition given under residential complex service, the same cannot be held to fall under ‘Construction of Residential Complex Service’. What is required to be seen is whether or not total consideration is a non-vivisectable for a composite contract. The answer is ‘yes’ because the Show Cause Notice also could not identify the amount of consideration for the pure service and thus holds that they are eligible for abatement covered in terms of Notification No. 18/2005-ST dated 7.6.2005.
As the issue involves, interpretation of legal provisions, extended period cannot be invoked.
Conclusion - The demand of service tax under 'Construction of Residential Complex Service' is unsustainable. The contract fell within the ambit of 'Works Contract Service' and the demand under the impugned category is set aside.
The impugned order cannot be sustained and therefore set aside - Appeal allowed.
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2025 (6) TMI 186
Invocation of extended period of limitation - insurance income - business auxiliary services or not - Income from Transportation - Income from weigh bridge - Amounts received on account of delayed payments - penalties.
Insurance income - business auxiliary services or not - HELD THAT:- The same amount collected by the appellant (as representing transit insurance) cannot be charged to central excise duty by including this amount in the assessable value and again be treated as a service to charge service tax on it. The demand of service tax on this amount cannot be sustained.
Income from Transportation - HELD THAT:- The same activity of transportation cannot be treated as GTA service to charge service tax under reverse charge and also as BAS to charge service tax on forward charge basis. Since the appellant had paid service tax under reverse charge under GTA, no service tax on transportation can be charged treating it as BAS (upto 1.7.2012) and as service (after 1.7.2012). The demand on this count cannot be sustained.
Income from weigh bridge - HELD THAT:- The learned counsel for the appellant agreed upon that providing a weigh bridge does not amount to providing Business support service as held in Shivam Marine [2024 (10) TMI 1258 - CESTAT AHMEDABAD]. The demand on this count cannot be sustained.
Amounts received on account of delayed payments - HELD THAT:- After 1.7.2012, certain services were named ‘Declared Services’ under section 66E of the Finance Act. These are certainly to be treated as taxable services and service tax has to be collected. Clause (e) of this section includes ‘an agreement to refrain from an act or to tolerate an act’. It has been held by this Tribunal in a catena of orders that this clause would apply only if there is an agreement to tolerate an act, i.e., if the purpose of the agreement was to tolerate an act. If the purpose of the agreement is not tolerate an act but any amount is paid as compensation for default (such as delayed payments in this case), such amounts cannot be called as amounts collected to tolerate an act under section 66E (e) of the Finance Act. Therefore, the demand on this count also cannot be sustained.
Penalties - HELD THAT:- The entire demand of service tax in the OIO upheld by the impugned order deserves to be set aside. Consequently, the demand of service tax and the imposition of penalties also need to be set aside.
Conclusion - i) The demand of service tax on insurance income was not sustainable. ii) The demand of service tax on transportation income was unsustainable. iii) The service tax demand on weigh bridge income was not sustainable. iv) The demand of service tax on delayed payment charges was unsustainable. v) The extended period of limitation and penalties imposed were set aside along with the service tax demand.
The impugned order is set aside - Appeal allowed.
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