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Service Tax - Case Laws
Showing 41 to 60 of 133 Records
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2014 (3) TMI 733 - CESTAT AHMEDABAD
Denial of refund claim - Unjust enrichment - whether unjust enrichment will be applicable in the refund of Service Tax once collected by the appellant but subsequently returned to the customers by issue of credit notes - Held that:- unjust enrichment is not applicable to the Service Tax refunds when the amount has already been paid to the customers by issuing credit notes or is not paid at all by the customers - Following decision of CST Ahmedabad Vs. Poornima Advertising & Promotion Pvt. Ltd. [2009 (11) TMI 456 - CESTAT, AHMEDABAD] - Decided in favour of assessee.
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2014 (3) TMI 697 - CESTAT NEW DELHI
Waiver of pre-deposit - Commercial coaching and training service - taxability of grant received from government for various programmes like PMRY, EAC, EDP, RDSY, MDS/DOP etc. - taxability of data digitization charges - assessee claims that they undertakes various training programmes under the welfare scheme of the Central Government and State Government - Held that:- Since the appellant institute provides courses which result in the award of diplomas or degrees, as mentioned above, which are recognized under the law, the appellant institute would not be covered by the definition of ‘commercial training or coaching centre’ and, therefore, we are of the prima facie view that any training programmes conducted or organized by the appellant would not attract service tax under Section 65 (105) (zzc) readwith Section 65 (27) ibid. Therefore, the service tax demand in respect of the appellant’s alleged activities as commercial coaching or training centres is not sustainable. - Decided in favor of assessee.
As regards business support service - data digitization charges - Held that:- the activity of data digitization for various Government department would not be covered by the definition of support services of business or commerce as the data digitization service for various Government departments cannot be treated as the service in relation to business or commerce.
Extended period of limitation - Held that:- it would be absurd to allege that an institution run by the State Government and which is associated in implementation of various welfare schemes of the centre and State Government like Prime Minister Rozgar Youjana (PMRY), Prime Minister Employment Generation Programme (PMEGP), Mass Employment Generation through Science & Technology (MEGSET), Swayam Siddha project for upliftment and development of women in the rural areas, Rani Durgawati Swarozgar Yojana (RDSY), CM Gharelu Kamkaji Mahila Yojana (CMGKMY) etc. by organizing various training programmes to improve the skills of poorer sections of the society, of having evaded service tax by taking recourse to fraud, wilful misstatement, suppression of facts etc.
On this point, the approach of the department is absurd and, therefore, neither longer limitation period would be invokable not penalty under Section 78 would be attracted. Therefore, in any case, bulk of the service tax demand would be time barred. - Stay granted.
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2014 (3) TMI 696 - CESTAT NEW DELHI
Export of services or not - place of provision of services - location of recipient - receipt in foreign exchange - business auxiliary service - services in relation to export of goods - giving recommendation about the product integrity, inspecting export consignments and issuing inspection certificates, screening the vendor’s suitability in terms of child labour norms and pollution control norms and recommending the teams to be engaged in logistic work like transportation, clearing and forwarding etc. for export of the purchased products out of India - Export of Service Rules, 2005 - Held that:- the arguments of the department are absurd as the DR has not mentioned as to who is the consumer of the services in India, if the services, in question, provided in India by the appellant have not been used and consumed by their principal in U.S.A.
It would be absurd to say that the recipient and user of these services are the persons in India and not M/s GAP, U.S.A. for whom all these services provided by the appellant are meant, who have used these services for their business and have made payment for these service in convertible foreign exchange.
The Export of Service Rules, 2005 and Taxation of Service (provided from outside India and received in India) Rules, 2006, readwith Section 66A of the Finance Act, 1994 are fully in accordance with the law laid down by the Apex Court in case of All India Federation of Tax Practitioners [2007 (8) TMI 1 - Supreme Court] and Association of Leasing and Financial Service Companies (supra) that service tax is a value added tax, which, in turn, is a destination based consumption tax in the sense that it is not a charge on business but is a charge on the consumer.
Therefore what constitutes export of service has to be decided strictly in accordance with the provisions of Export of Service Rules, 2005 and for this purpose, in case of services in relation to business or commerce covered by Rule 3 (1) (iii), the term ‘service recipient’ has to be understood in the sense as explained in para 8.3.
The performance of such service in India, would not make them received/consumed in India, if beneficiary user/recipient of said service provided in relation to business or commerce, who has paid for these service and has used the service in his business, is located abroad. - The position would be different if the company located abroad who has paid for the service, also has some branch/ project in India and the service provided in India is meant for that branch/project only in that case, the consumption of service would be in India and the service would be taxable in India.
The Boards Circular No. 141/10/2011 dated 13/5/11 clarifying that for the period prior to 27/2/10, the condition regarding ‘used outside India’ also needs to be independently satisfied for availing the benefit of export and that ‘effective use of advertisement services’ shall be the place where the advertising material is disseminated to the audience though the actual benefit to my finally accrue to the buyer who is located at another place is not only not in accordance with the provisions of Rule 3 (1) of the Export of Service Rules, 2005, but is also contrary to the law laid down by the Apex Court in the case of All India Federation of Tax Practitioners [2007 (8) TMI 1 - Supreme Court] and Association of Leasing and Financial Service Companies [2010 (10) TMI 4 - SUPREME COURT OF INDIA], as a service which has not been consumed in India, cannot be taxed in India.
In any case, the issue involved in this case is identical to the issue involved in the case of Paul Merchant Ltd. and Ors. vs. CCE [2012 (12) TMI 424 - CESTAT, DELHI (LB)] which stands decided in favour of the appellant. - order set-aside - Decided in favor of assessee.
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2014 (3) TMI 695 - CESTAT BANGALORE
Cenvat Credit - scope of input services i.e. (i) group health insurance scheme as regards employees, (ii) services utilised for construction, maintenance or repair or renovation of Global Training Centre, (iii) services used in respect of hostel, food court, gym etc - Demand of service tax in respect of information technology software services received from overseas sub-contractors to overseas branches of the appellant - reverse charge - Held that:- if the insurance policy covers persons other than employees and no contribution is required from the employees towards such coverage, the service tax paid on insurance premium to that extent on a proportionate basis will have to be reversed. It cannot be said that the insurance provided to the parents or family towards all the employees is relatable to output services provided by the appellant. - matter remanded to verify and limit the demand to the extent of service tax payable on insurance premium attributable to families of employees, if other family members are covered and expenses are borne by the appellant. - Decided partly in favor of assessee.
As regards global training centre, in view of the fact that learned counsel has made vehement submission that the appellant was providing commercial training and coaching service and the premises of global training centre is often used for conducting commercial coaching service on which service tax is paid, credit would be admissible since it becomes a premises of the service provider for providing the service of commercial training or coaching centre. At this juncture, it becomes necessary to note the fact up to 1.4.2011, setting up of a premises of output service provider was also an activity for which services used were eligible for credit.
As regards hostel and gym, in respect of which various services received had been claimed to be input service, it is quite clear from the definition that both of them cannot be considered as premises from where the service is provided or an office relating to the premises from where service is provided.
Liability of service tax - reverse charge - information technology software services received from overseas sub-contractors to overseas branches - Held that:- If the service has been rendered in USA or Canada received by the branch office of the appellant in USA or Canada and utilised by the branch office at USA or Canada and paid for out of the foreign exchange earned, unless the Revenue is able to show that the service has been received in India, or the benefit of service rendered abroad has been received in India, the tax, in our opinion, would not be payable.
It is not the case of the appellant that money was not paid. It is the case of the appellant that whatever consideration is received for services rendered by them abroad goes into EEFC account and the appellant is entitled to spend 75% of such receipts in EEFC account for payments abroad. Therefore the fact that appellants have made payment from EEFC account and not from funds in the hands of Infosys in India would go to show that whatever payments were made were made from export earnings only. This would mean that services were paid for by the earnings abroad - Following the decision in the case of KPIT Cummins Infosystems Ltd. [2013 (12) TMI 792 - CESTAT MUMBAI], decided in favor of assessee.
Levy of penalty and extended period of limitation - Held that:- In all these cases, wherever there is demand for service tax, the appellant would be eligible for the benefit of CENVAT credit also and therefore it cannot be said that there was any intention to evade payment of duty. - the demands wherever are sustainable in our opinion and where we have held so, would be only to the extent of denial of CENVAT credit within the normal period of limitation with interest but penalties are not sustained. - Decided partly in favor of assessee.
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2014 (3) TMI 694 - CESTAT AHMEDABAD
Refund - Taxability of service - construction of complex service or works contract service - residential complex having more than 12 residential units - agreements entered into by a builder/promoter/developer with prospective buyers for construction of residential units in a residential complex against payments being made by the prospective buyers in instalments during construction - Held that:- such contracts are to be treated as works contracts, it has to be held that during the period of dispute, there was no intention of the Government to tax the activity in terms of such contracts a builder/developer with prospective customers for construction of residential units in a residential complex. Such works contracts involving transfer of immovable property were brought within the purview of taxable service by adding explanation to Section 65 (105) (ZZZh) w.e.f. 01/7/10, and therefore, it has to be held that such contracts were not covered by Section 65 (105) (ZZZh) during the period prior to 01/7/2010. - Decided in favor of assessee.
Tribunal in the case of CCE, Chandigarh vs. U.B. Construction (P) Ltd. [2014 (1) TMI 402 - CESTAT NEW DELHI] has held that the explanation to Section 65 (105) (ZZZh) added w.e.f. 01/7/10 expands the scope of this clause and hence the same is not a clarificatory amendment and, as such, it cannot be given retrospective effect and accordingly during period prior to 01/7/10, when this explanation was not there, no service tax can be charged on the amount received by the builders/developers from the prospective buyers, that same view has been taken by the Tribunal in the case of R.F. Properties & Trading Ltd. vs. CCE, Jaipur [2013 (7) TMI 44 - CESTAT NEW DELHI] that in view of this, in both the cases, the appellant/respondent are eligible for refund on merits
Refund - period of limitation - Held that:- since in terms of the findings of the Commissioner (Appeals) which have not been disputed, the service tax had been paid under protest, the limitation period would not apply.
Unjust enrichment - Held that:- there is no evidence that they had charged any amount towards service tax from their customers. The presumption under Section 12B of the Central Excise Act, 1944 is a rebuttable presumption and when an assessee shows invoices issued by him is support of his claim that no amount representing service tax had been charged by him from his customers, the burden would shift to the department to produce evidence that the incidence of the tax, paid whose refund is sought had been passed on to the customers. In this case, no such evidence has been produced by the department. - Refund allowed.
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2014 (3) TMI 656 - BOMBAY HIGH COURT
Bail application under offence punishable under Section 89 read with Section 90 of the Finance Act, 1994 - non payment of Service Tax - Held that:- scheduled payment offer made by the assessee was not acceptable by the revenue - it is a continuing offence and as on 10.5.2013 there were huge outstandings definitely beyond the amount of Rs.50 Lakhs and more so said amount was outstanding even at the time of arrest of the applicant, it is not a case in which the applicant can be released on bail more so when the investigation is still going on - Decided against appellant.
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2014 (3) TMI 655 - MADRAS HIGH COURT
Maintanability of appeal - Bar of limitation - Whether the Appellate Tribunal is right in upholding the order of the Commissioner (Appeals) dated 7.8.2012, dismissing the appeal as time barred - Held that:- It is a well settled position in law that the period of limitation prescribed for the hearing of the appeal, by the Appellate Tribunal, under Section 85(3) of the Finance Act, 1994, cannot be extended - appellate Tribunal does not have the power or the authority to extend the period of limitation prescribed by the statute, for entertaining the appeal - Decided against the assessee.
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2014 (3) TMI 654 - CESTAT NEW DELHI
Review of order where tribunal Condoned the delay - Delay of 9 days - Revenue now pleads that in view of several decisions of the Supreme Court - Held that:- This application seeking rectification/review of the order dated 19.8.2013, condoning a delay of nine days, for the detailed reasons recorded therein, is clearly a fundamentally misconceived and frivolous application. We are burdened with a huge pendency. It is regrettable that not only are such frivolous applications filed by Revenue but are even argued by DR's at great length and unmerited vehemence. There is also no provision, conferring jurisdiction on the Tribunal to review an order condoning delay in presenting the appeal - Decided against revenue with cost.
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2014 (3) TMI 653 - CESTAT NEW DELHI
Demand of service tax on fee for pre-closure of loans - Business auxiliary service - Suppression of facts - Held that:- Revenue’s contention is that the National Housing Bank with which the appellant is associated collects pre-closure charges from the appellant along with the service tax component and the National Housing Bank remits service tax (for an unspecified taxable service) and the appellant avails Cenvat credit on the service tax component remitted to the National Housing Bank, together with the pre-closure fee charged by National Housing Bank. In the circumstances, the appellant must be presumed to be aware of its liability to service tax on the consideration/charges received by it from its customers, i.e. on pre-closure of loans. Since Revenue concedes the position that the transactions in issue do not amount to business auxiliary service and since there is no allegation of the appellant having provided any other taxable service, we fail to comprehend this contention and as to how the appellant’s presumed knowledge of its tax liability on fore-closure charges received, would render it liable to service tax, for being provided Business Auxiliary Service, which is admittedly inapplicable - Decided in favour of assessee.
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2014 (3) TMI 606 - CESTAT MUMBAI
Demand of service tax - Tour operator service - Liability on seat reservation charges - Penalty u/s 76 & 78 - Held that:- The Bus reservation agreement is for booking of the buses for the tours undertaken to Nasik, Ellora, Ghrisneshwar, Siddharth Garden, etc. and the tour starts at 5.00 a.m. on 22/11/2007 and concludes at 7.00 p.m. on 23/22/2007. Thus, the bus reservation is for conduct of the tours and therefore, it forms rightly part of the tour operator services as defined in law.
Two penalties have been imposed, one under Section 76 and another under Section 78. Section 76 penalty is imposable if there is a delay or default in payment of service tax and no mens rea is required to be proved. However, imposition of penalty under Section 78 is for suppression of facts, collusion, fraud etc. In this particular case, since the activity has been in dispute since 2004, the department cannot allege suppression or willful mis-statement of facts. Therefore, the penalty under Section 78 is neither justified nor warranted in the circumstances of the case - Following decision of CHOUDHARY YATRA CO PVT LTD Versus COMMISSIONER OF CENTRAL EXCISE. NASHIK [2012 (11) TMI 251 - CESTAT, MUMBAI] - Decided partly against assessee.
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2014 (3) TMI 605 - CESTAT KOLKATA
Rent a Cab Operator Service - Scope of the term Motor Cab - Renting or Hiring - Penalty u/s 77 & 78 - Held that:- assessee has been supplying vehicles such as Maruti Van/Maruti Suzuki/Alto having seating capacity 4+1 including the driver and Ambassadors having seating capacity 4+1 and 5+1 including the driver to M/s. NEEPCO Ltd., Shillong as stated by the said assessee in his statement on 27.05.2009 and also the documents submitted vide their letter dated 15/06/2009 indicates that all the vehicles supplied by them to NEEPCO Ltd. are vehicles having seating capacity of 4+1 and 5+1. As the said vehicles are constructed or adapted to carry not more than 6 passengers excluding the driver, therefore, they conform to the definition of Motor Cab" as per Section 65 (70) w.e.f. 14.05.2003 of Chapter V of the Finance Act.
Definition of Rent a Cab Scheme Operator was amended w.e.f. 16.10.1998 vide Finance (NO2) Act 1998 which reads as "Rent a cab Scheme Operator'" means any person engaged in the business of renting of cabs, thus the requirement of operator being registered under the Rent a Cab Scheme Operator had been dispensed with. Consequently, any person engaged in the business of renting of cabs was required to pay service tax irrespective of number of vehicles engaged by him in providing this service.
Lower authorities have not examined the issue whether the activity of the appellant falls under the ambit of "hiring" or as the case may be renting. - appellant's case requires re-examination in light of each of their contracts entered by them and the various service recipients. - matter remanded back.
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2014 (3) TMI 604 - CESTAT KOLKATA
Waiver of predeposit of Service Tax - Imposition of penalty u/s 76 & 78 - Held that:- service tax liability on the Applicant has been fastened on the ground of rendering taxable service namely, commercial as well as residential construction services for the period from 2004-05 to 2007-08 - after allowing the abatement and ignoring the principle laid down in Jaihind Projects Ltd.’s case (2010 (1) TMI 186 - CESTAT, AHMEDABAD), the liability would be reduced to Rs.42.00 lakh. - Considering the financial hardship pleaded by the Applicant, we are of the view that the offer made by the ld. Chartered Accountant to deposit Rs.20.00 lakh out of the said liability of Rs.42.00 lakh, is reasonable. - stay granted partly.
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2014 (3) TMI 603 - CESTAT KOLKATA
Penalty u/s 78 - Violation of principle of natural justice - Held that:- allegations were labeled on the Appellant for non-payment of Service Tax on the gross taxable value received and reflected in their balance sheets for the respective years. However, from the records we find that the Appellant was not given sufficient opportunity to explain his position in relation to the allegations made in the show cause notice - minimum number opportunities of hearing as laid down under Section 33A of the Central Excise Act, 1944 made applicable to the Service Tax cases has not been adhered to in the present case. In these circumstances, we are of the view that the case be remitted to the original authority for re-consideration of the matter afresh - Decided in favour of assessee.
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2014 (3) TMI 589 - CALCUTTA HIGH COURT
Application for bail - petitioner has been charged for commission of offence punishable under Section 89(1)(d) of the Finance Act, 1994 - Held that:- On query, the learned lawyer of the Union of India could not satisfy me whether strictly custodial detention is necessary for interrogation or not vis-à-vis their prayer as embodied in the petition itself. It is correct that the offence is alive till now but it is not less than correct that when it was originated, the offence was bailable in view of the observation made by the Hon’ble Apex Court [2010 (12) TMI 1085 - SUPREME COURT]. It is also reckoned that the new Act does not have any retrospective effect.
If this be so, the question of bailability and non-bailability almost comes to a point of merger, the benefit of which should be extended to the accused person. - Bail granted subject to conditions.
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2014 (3) TMI 567 - GUJARAT HIGH COURT
CENVAT Credit on GTA services - upto the place of removal - scope of the terms 'means and includes' - Rule 2(l) of CCR - Held that:- main body of the definition of term ‘input service’ is wide and expansive and covers variety of services utilized by the manufacturer. By no stretch of imagination can it be stated that outward transportation service would not be a service used by the manufacturer for clearance of final products from the place of removal.
When we hold that outward transportation would be an input service as covered in the expression ‘means’ part of the definition, it would be difficult to exclude such service on the basis of any interpretation that may be offered of the later portion of the definition which is couched in the expression ‘includes’. As already observed, it is held in several decisions that the expression ‘includes’ cannot be used to oust any activity from the main body of the definition if it is otherwise covered by the expression ‘means’. In other words, the expression ‘includes’ followed by ‘means’ in any definition is generally understood to be expanding the definition of the term to make it exhaustive, but in no manner can the expression ‘includes’ be utilized to limit the scope of definition provided in the main body of the definition. To our mind this was also not the intention of the Legislature in the present case - Following decision of COMMISSIONER OF C. EX. & CUSTOMS Versus PARTH POLY WOOVEN PVT. LTD. [2011 (4) TMI 975 - GUJARAT HIGH COURT] - Decided against Revenue.
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2014 (3) TMI 566 - DELHI HIGH COURT
Inclusion of Re-imbursement of expenses in the value of taxable services for the purposes of levy of service tax - Validity of Rule 5 (1) of the Service Tax (Determination of Value) Rules - Held that:- Court hereby directs the respondents not to proceed further in terms of the impugned show cause notices or draw or enforce any demand against the petitioner. The respondents would, however, be at liberty to initiate proceedings in the event of and having regard to the final orders of the Supreme Court in the pending appeal - Decided in favour of assessee.
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2014 (3) TMI 565 - CESTAT KOLKATA
Waiver of pre deposit - re-consideration of the stay order directing pre-deposit of 25% after the matter remanded by the High Court - Penalty u/s 78 – Work contract service - taxability prior to 1-7-2007 - Abatement of 67% - Waiver of pre-deposit - the main plank of argument advanced on behalf of the applicant that since there is a cross-fall-breach clause specifying that breach of one contract would also constitute breach of other contract, hence, both these contracts should be read together and accordingly the entire project being a turnkey project, the same is taxable as works contract only w.e.f. 1-7-2007 and not prior to that - High Court remanded matter back for fresh consideration - Held that:- it would be just and appropriate to direct the Applicant to deposit the offered amount of Rs.1.00 crore pending disposal of the Appeal. - stay granted partly.
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2014 (3) TMI 564 - CESTAT MUMBAI
Demand of service tax - Business auxiliary service - Held that:- appellants are owner of property and entered into an agreement titled as ‘Franchise Agreement' with M/s. Amalgamated Bean Coffee Trading Co. Ltd. to run café, making and selling coffee and other eatables under the brand name 'Café Coffee Day' - Following the previous decisions of this Tribunal - Decided in favour of assessee.
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2014 (3) TMI 563 - CESTAT MUMBAI
Availment of CENVAT Credit - Overseas commission (BAS), Customs House Agents and Terminal Handling Services - Equivalent penalty under Rule 15 of the Cenvat credit Rules, 2004 read with Section 11AC of the Central Excise Act, 1944 - Held that:- Service tax paid on overseas commission is available to the assessee as Cenvat credit. Similarly, in case of availability of Cenvat credit paid on the Customs House Agents and Shipping Lines, allowed the same by following the Tribunal in the case of M/s. Vidyut Metallies Pvt. Ltd. Vs. CCE, Mumbai - [2012 (6) TMI 486 - CESTAT, MUMBAI] as also the Tribunal decision in the case of M/s. Steel Strips Wheels Ltd. Vs. CCE, Chandigarh-II - [2013 (3) TMI 399 - CESTAT, NEW DELHI] - Decided against Revenue.
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2014 (3) TMI 545 - CESTAT BANGALORE
Penalty u/s 76 & 78 - Rent-a-cab service - Mis declaration of service - Held that:- the appellants had filed the return correctly but made the mistake in calculation of tax payable and as soon as the same was pointed out and a show-cause notice was issued, the appellants paid the amount with interest. There is no specific finding that the mis-declaration was with intention to evade duty/tax. If the intention was to evade the tax, naturally the amount received would not have been declared correctly. Even accepting the submission that there was a mis-declaration on the part of the assessee in calculating service tax, the intent to evade tax does not flow from this submission. Therefore the fact remains that appellant paid the tax and interest after the issue of show-cause notice and what remains is only the dispute about the penalty - impugned order is set aside and the service tax paid with interest is confirmed as paid correctly and penalties imposed are set aside by invoking the provisions of Section 80 of Finance Act, 1994 - Decided in favour of assessee.
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