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Service Tax - Case Laws
Showing 41 to 60 of 209 Records
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2014 (7) TMI 974
Intellectual property rights for allowed user of its brand name - manufacture of ‘country liquor; from spirit on job work basis - Held that:- on appreciation of the clauses of agreement with the evidence on record, it is evident that no ‘Intellectual Property Service' have been given by the appellant. The arrangement/agreement between the appellant and M/s Talreja Trade are for ensuring maximum production and sale of C.L. so as to maximize profits for both the parties. The minimum guarantee of profit per month given or assured by the agent to the appellant have been misunderstood as ‘Royalty' which is not the fact. The ground of limitation is also allowed in favour of the appellant. - Decided in favour of assessee.
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2014 (7) TMI 973
Waiver of pre deposit - Business Auxiliary Service - realization of money due - book adjustment by the client would amount to receipt of consideration or not - there was opening dues from AASL to IAL amounting to ₹ 134.53 crores. By Mar 2007 this amount increased to ₹ 306.75 crores. This is the reason why the appellant is contesting that they have not realised the monies due from AASL - Held that:- explanation in section 67 of Finance Act, 1994 defining value of taxable services inserted with effect from 18-4-2006 - There is no such clear provision for period prior to 18-4-2006. But when money is deducted by one person from amounts due to another in the hands of the former and such adjustments are agreed upon, it is to be considered that payment has been made by the latter to the former.
In the instant case IAL was receiving payments through the mechanism of deduction from amounts due to AAIL in the hands of IAL. The fact that the operations of AAIL resulted in loss and the losses were absorbed by IAL cannot negate the fact that at the time of rendering the services consideration thereon was received. So we are not in prima facie, agreement with the argument that IAL had not received payment for services rendered.
Considering the fact that the appellant is a national carrier under the ownership of Government of India presently facing serious financial difficulties and in view of the overall appreciation of the issues involved as analyzed above - unconditional stay granted.
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2014 (7) TMI 972
Port service - wharfage charges - under-valuation - receipt of additional consideration - Non inclusion of amount which was to be granted as rebate to M/s. UCL for discharge of service tax liability and the amount received by them as lease rent for waterfront charges and lee way facility given to M/s. UCL - Invocation of extended period of limitation - Penalty u/s 76, 77 & 78 - Held that:- Neither of the two conditions for being a port service is being fulfilled. Except for the ownership of the waterfront, GMB had no role to play. The entire port with infrastructure was built by M/s. UCL Ltd. and would be owned and operated also by M/s. UCL Ltd. under BOOT scheme. Thus, no service of whatsoever nature has been rendered by GMB, which may fall under the category of port service. No service has been rendered by them in relation to a vessel or goods. Just because ₹ 20 has been charged by GMB from M/s. UCL Ltd. under the head wharfage charges and GMB has paid service tax on the same under the category of port service, it cannot be said that the service rendered, if at all, by GMB was a port service.
There is no estoppel against the law - except for the ownership of waterfront, GMB does not own anything. The port and the infrastructure thereon vests in M/s. UCL Ltd. and this is permissible under Indian Law as there can be two owners, one for the waterfront and another for port and infrastructure thereon. The law in India is that land can belong to one and building thereon can be of other person as compared to law in U.K. wherein building vests in the owner of the land - in the absence of any port service having been rendered by GMB, the question of charging differential service tax under the category of port service does not arise at all. The show-cause notice has not invoked any other head for taxing the service, if any.
Renting of immovable property - allowing the user of waterfront for construction of port and infrastructural facility - Held that:- it can reasonably be concluded that allowing the user of the water front by M/s. GMB to M/s. UCL Ltd. was allowing the use of immovable property by GMB to M/s. UCL Ltd., and hence, ₹ 20 charged by GMB to M/s. UCL Ltd. at the most was on account of renting of immovable property. Just because the said charge were linked to the number of ships, it will not convert the same into port charges because basis of quantification or measurement is not relevant while deciding on the nature of the charges.
Valuation - Held that:- Even if it is assumed that the grant of licence to use waterfront is a port service, appropriate tax on the "gross amount" actually charged by GMB for such service has already been discharged. - Applying the definitions of "gross amount charged" and "money" to the present case, it is evident that the only amount received by GMB is the amount equivalent to 20 per cent. of the usual wharfage charges, as the remainder 80 per cent. was rebate or a discount offered by GMB. - It is not in dispute that the remainder amount which was offered as rebate was not paid back to GMB either as "deduction from account" or "credit note" or "debit note" or by book adjustment.
Even if the capital expenditure incurred for development of waterfront is regarded as "construction", the next logical question that will arise is whether the entirety of such construction is liable to be included in the value. - it is the absence of such a machinery provision itself sufficient indication that the Legislature did not intend to tax that transaction.
The Revenue's case is even otherwise illogical and absurd as it seeks to assess the services rendered by GMB with reference to the normal wharfage charges which it recovers from users at the full-fledged ports developed and operated by GMB, such as the Kandla Port. This is clearly illogical as in the present case the service rendered by GMB was limited and confined to the grant of licence to use the waterfront for which it charged a limited amount (20 per cent. of the usual wharfage). Considering the limited nature of the service rendered, GMB could only charge a limited consideration. This amount, which happens to be 20 per cent. of the usual wharfage charge, is the amount actually paid and in the absence of any book adjustment or deduction from the account constitutes the "gross amount" actually charged for the service - any amount collected after April 1, 2008 by Gujarat Maritime Board, can be considered as statutory levy only and service tax liability thereon may not arise - impugned order is unsustainable and is liable to be set aside - Decided in favour of assessee.
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2014 (7) TMI 942
Restoration of appeal - Non compliance of pre deposit order - Extension of time for making pre deposit - Held that:- In view of the stand taken by the learned advocates appearing on behalf of the respective parties as recorded hereinabove and in the facts and circumstances of the case and so as to see that on granting one additional opportunity to the respective appellant to make the deposit on pre-deposit as directed by CESTAT the appeals preferred by the respective appellants is considered on merits, we grant further time to the respective appellants to make the deposit of pre-deposit as directed by CESTAT earlier while passing the order dated 03-01-2012 /31-07-2012 in respective stay applications/stay orders i.e. ₹ 1.20 Crores to be deposited on or before 30/09/2014 and the balance amount of ₹ 30 lakhs to be deposited on or before 15/10/201 - Decided partly in favour of assessee.
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2014 (7) TMI 941
Power of tribunal to grant stay beyond the total period of 365 days - extension of stay granted earlier - extension order should be speaking or not - Held that:-in case and having satisfied that delay in not disposing of the appeal within 365 days (total) from the date of grant of initial stay is not attributable to the appellant / assessee in whose favour stay has been granted and that the Appellate Tribunal is satisfied that such appellant / assessee has fully cooperated in early disposal of the appeal and/or has not indulged into any delay tactics and/or has not taken any undue advantage, the learned Appellate Tribunal may, by passing a speaking order as observed hereinabove, extend stay even beyond the total period of 365 days from the date of grant of initial stay.
However, as observed by the Hon’ble Supreme Court in the case of Kumar Cotton Mills Pvt. Ltd (2005 (1) TMI 114 - SUPREME COURT OF INDIA), it should not be construed that any latitude is given to the Appellate Tribunal to extend the period of stay except on good cause and if the Appellate Tribunal is satisfied that the matter could not be heard and disposed of by reason of the fault of the Appellate Tribunal for the reasons not attributable to the assessee. It also may not be construed that the Appellate Tribunal can extend stay indefinitely.
It also may not be construed that the Appellate Tribunal can extend stay indefinitely. On expiry of every 180 days the concerned assessee / appellant is required to submit an appropriate application before the learned Appellate Tribunal to extend the stay granted earlier and the Appellate Tribunal may extend the stay for a further period but not beyond 180 days at a stretch and on arriving at the subjective satisfaction, as stated hereinabove, the Appellate Tribunal may extend the stay even beyond 365 days from the date of grant of initial stay and even thereafter. - Thus, on expiry of maximum period of 180 days the assessee / appellant is required to submit application for extension of stay each time and the Appellate Tribunal is required to consider the individual case and pass a speaking order, as stated hereinabove - Following decision of Commissioner Versus Small Industries Development Bank of India [2014 (7) TMI 738 - GUJARAT HIGH COURT] - Matter remanded back - Decided partly in favour of assessee.
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2014 (7) TMI 940
Challenge to the Show Cause notice - writ petition - Commission to overseas agencies - reverse charge - Business Auxillary Services - Held that:- By the impugned notice, the petitioner was only called upon to submit their objections, if any. The show cause notice has been issued in compliance with the principles of natural justice and it cannot be said to be arbitrary or illegal. Therefore, the writ petition is disposed of with a direction to the petitioner to submit their explanation to the notice which is impugned in this writ petition along with necessary documents in support of their claim. - On receipt of such notice, the respondents shall afford an opportunity of hearing to the petitioner and then pass orders on merits and in accordance with law.
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2014 (7) TMI 939
Waiver of pre-deposit - appellant argued that the nature of services provided by the Railway and considering its status in law the Tribunal should not have directed payment of any sum of ₹ 25 lacs - Held that:- perusing Section 99 which came to be inserted by the Finance Act, 2013 with effect from 10.05.2013, we are of the opinion that the Appellants have made out a strong prima facie case and of complete waiver of a predeposit condition. The impugned order is, therefore, quashed and set aside. The application for stay/waiver of predeposit is allowed accordingly. - stay granted.
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2014 (7) TMI 937
Waiver of penalty u/s 80 - Penalty levied u/s 77 & 78 - delayed payment of service tax - Dry cleaning service - Held that:- The statutory levies cannot be obviated for so long merely because the computer was down. Further, even if the computer was down, the appellant could have filed the return manually and paid service tax by comuting the same manually as the total number of invoices involved during the entire period were less than 50. Further even if their untenable argument is considered for a moment, being aware that they have not paid service tax due and not filed statutory ST-3 returns for so long, if their bonafides were above board, they should / wouldhave atleast informed the department about it. It was only when the raid was conducted and they were caught that they admitted their violations. - penalty could not be waived - Decided against assessee.
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2014 (7) TMI 936
Erection of electricity transmission tower - Notification No.45/2010-ST dt. 20.7.2010 - Held that:- By Notification No.45/2010-ST dt. 20.7.2010 issued under Section 11C of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1944, the Central Government directed that the service tax payable on the taxable services relating to transmission and distribution of electricity provided by the service provider to the service recipient, which was not being levied in accordance with the said practice, shall not be required to be paid during the period upto 26.2.2010 for all taxable services relating to transmission of electricity and the period upto 21.6.2010 for all taxable services relating to distribution of electricity - demand of tax is for the period May 2006 to May 2007 relating to transmission of electricity - Therefore, demand not sustainable - Decided in favour of assessee.
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2014 (7) TMI 935
Membership of club or association service - Penalty u/s 77 - Appellate Commissioner granted partial relief by dropping penalty under Section 77 - Held that:- Following decision of M/s Federation of Indian Chambers of Commerce and Industry, M/s Electronic and Computer Software Export Promotion Council Versus CST, Delhi [2014 (5) TMI 183 - CESTAT NEW DELHI] - Decided in favour of assessee.
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2014 (7) TMI 934
GTA service - Exemption under Notification No. 34/2004-ST dated 03/12/2004 - obiter dicta - Held that:- Prima facie it appears that the appellant is not eligible for exemption because the entire goods transported by the GTA in the present consisted of only a single consignment and the freight charges for the single consignment exceeded ₹ 750/- and therefore, in view of the decision of this Tribunal in the case of Bellary Iron & Ores Pvt. Ltd. (2009 (12) TMI 150 - CESTAT, BANGALORE), the appellant is prima facie not eligible for the exemption. The reliance placed on the decision of the Hon'ble Bombay High Court deals with an obiter dicta. In the Bellary Iron & Ores Pvt. Ltd. case, the findings given therein are not obiter dicta of this Tribunal.
The Tribunal discussed the entire notification and thereafter considered its scope and passed an order. Therefore, the same cannot be considered as an obiter dicta. As regards the reliance placed on the decision in the case of Gondal Prestressed Concrete, it is only an interim order and it is a settled position in law that interim order does not lay down any ratio. The appellant has also not pleaded any financial hardship - appellants have not made out any case for complete waiver of the dues adjudged against them - stay granted partly.
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2014 (7) TMI 933
Demand of service tax - Real estate agent service - Whether M/s. SRL have provided Real Estate Agent Service to M/s. SEL in terms of the Agreement between these two parties - Held that:- For a service to be covered under the definition of Real Estate Agent, it should be provided by a person to another person in relation to sale, purchase, leasing or renting of Real Estate. In the present case SRL, as indicated above in para 3, purchase/obtain lease of land in their own name. Further, they are not paid any commission by M/s. SEL. In fact the commission of 11% is received from the customers as consideration for the sale/lease, in addition to the cost of acquisition of land and other expenses. Thus, it cannot be said that they have provided any service to M/s. SEL in relation to purchase and further sale/lease of land to customers of M/s. SEL. As the definition of Real Estate Agent includes a real estate consultant, it needs to be examined whether the activity of M/s. SRL would come in the ambit of real estate consultant.
From the fact on record advice is not provided by M/s. SRL to M/s. SEL. In fact, it is M/s. SEL, who provide technical inputs regarding suitability of land for wind farm projects, identify the suitable land and thereafter, as per the terms of the Agreement, ask M/s. SRL to acquire/lease such land. The land has to be free of any encumbrance before transfer of such land to the customers of M/s. SEL or to M/s. SEL themselves. All the regulatory approvals benefit the purchaser of land and expenses incurred thereon are recovered from the purchaser. Thus no real estate agent service can be said to have been provided by M/s. SRL to M/s. SEL. - Even the facilitation of loans by M/s. SEL to M/s. SRL for purchase of land and mortgage thereof is a financial arrangement between two which does not make M/s. SRL, real estate agent. Such financial arrangements and the exigibility to service tax thereof is not the issue here. The books of accounts of the appellants indicate that they hold large inventory of land. No consideration has been shown to be paid to M/s. SEL by M/s. SRL because no service is rendered by M/s. SRL to M/s. SEL. - M/s. SRL have not provided service of Real Estate Agent to M/s. SEL - Decided in favour of assessee.
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2014 (7) TMI 932
Transfer of tangible goods - service of Equipment Hire - Pipes rented out to farmers - Held that:- when pipes are handed over to farmers for use, it is natural that the assessee will not have control over its use that transfer of goods involve transfer of possession and effective control. Moreover it is the responsibility of the department to show that appellants have rendered a service which obligation has also not been fulfilled in this case.
Renting of immovable property - Held that:- Demand relates to the period prior to the amendment of definition of service carried out in 2010 and therefore show-cause notice is time-barred. In view of the fact that there was a dispute about the liability and there were different opinions and retrospective amendment was brought in, appellant was entitled to bona fide belief and therefore the extended period could not have been invoked.
As regards the service relating to Equipment Hire, assessee does not have any evidence in respect of this demand and therefore instead of remanding the matter prolonging the litigation he would prefer to pay the amount with interest and does not want to contest the demand. This is only on the ground that appellant does not want to undertake the search for documents etc.
Appellants suggestion not to contest the demand for service tax in respect of Equipment Hire amounting to ₹ 49,148/- plus interest and request for waiver of penalty by invoking provisions of Section 80 of Finance Act 1994 is reasonable. the demand for service tax of ₹ 49,148/- with interest is confirmed as not contested. Demand for service tax on Immovable Property Renting is set aside on the ground of limitation. Decided partly in favour of assessee.
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2014 (7) TMI 895
Utilization of CENVAT Credit for payment of service tax - cenvat credit by the respondents earned on the inputs received for manufacture of excisable goods towards payment of service tax for "Business Auxiliary Service" - Held that:- the respondents are not only a manufacturer of excisable goods but also the provider of output services and both the activities are carried out in the same premises.
Respondents are eligible for availment of input credit, they can utilize the cenvat credit available with them either for payment of excise duty on the final products or for payment of service tax on the output services as stipulated in the sub-rule (4) of Rule 3 of CCR 2004. The restrictions on utilization of cenvat credit stipulated in the CCR relates only for specific type of duties i.e. education cess on excisable goods or payment of educational cess on output services. There is no restriction for utilization of common input credit availed on the inputs and also on input services for payment of excise duty or service tax - there is no infirmity in the order of Commissioner (Appeals) in holding that utilization of input cenvat credit availed by the respondents for payment of service tax on the output service of Business Auxiliary Services rendered by them - Decided against Revenue.
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2014 (7) TMI 894
Cenvat credit - Rent-a-cab service - Revenue contends that rented cabs were not exclusively used for the purpose of providing output service - Held that:- Commissioner has given a categorical finding that the cabs in respect of which credit has been taken were used for providing output service which would clearly make the impugned credit admissible. In the grounds of appeal submitted by the Department they have merely stated that the impugned cabs were not exclusively used for the purpose of maintenance etc. but have not given any evidence to that effect. The Commissioner (Appeals) also observed that Revenue had not given any evidence contrary to the submissions of the appellants - no infirmity in the impugned order - Decided against Revenue.
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2014 (7) TMI 893
Demand of service tax - Transportation of effluent through pipeline or conduit - Whether appellant is liable to payment of Service Tax on the services of transportation of effluent through pipeline or conduit to M/s Heavy Water Project (HWP) on some consideration under Section 65(105)(zzz) - Held that:- As per definition of ‘goods’ given in Section 65 (50) of the Finance Act, 1994 the meaning of ‘goods’ for the purpose of Service Tax law has to be as assigned in Clause (7) of Section 2 of the Sales of Goods Act 1930. As per the provisions of Section 2(7) of Sales of Goods Act 1930 the goods has to be a category of ‘movable property’. Movable property in general trade parlance is considered as a property in goods which can fetch certain price. In the present facts and circumstances of the case the effluent discharge facility is for disposal of a waste which is not being purchased by any person but is only being disposed of by utilizing the services of the appellant. As the relevant facilities/services of transportation provided by appellant are not the ‘goods’ as defined in Section 2(7) of the Sales of Goods Act 1930, the same cannot be considered as a service provided for transportation of goods as per Section 65 (105)(zzz) of the Finance Act, 1994 read with Section 2(7) of Sales of Goods Act 1930 - Decided in favour of assessee.
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2014 (7) TMI 892
Recovery of service tax arrears - challenge to the Show Cause notice on the ground that they have not received the said notices and they have been despatched to different address and they came to know about the same only in the first week of May, when the 2nd respondent declined to pay the amount for the work done by them. - Held that:- it is crystal clear that though the address of the petitioner has been mentioned wrongly in all the correspondence, they have been duly acknowledged by the petitioner with signature and rubber stamp. - Further, it appears that the petitioner themselves have written a letter to the department on 2.5.2014 stating that they are prepared and willing to deposit the necessary service tax within a given time. Therefore, nothing more need to be added. - petitioner directed to remit service tax wi thin 2 months. - writ petition disposed of.
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2014 (7) TMI 891
Clim of refund by the recipient of services - excess service tax was paid by the service provider - difference due to downgrade revision in price - unjust enrichment - period of limitation - The case of the revenue was that it was the service provider, namely RGTIL which alone was entitled to file a claim before the Commissionerate concerned and RGTIL had recovered the service tax amount from various recipients. - Held that:- once the finding of the adjudicating authority that the claim for refund was filed within the period of limitation of one year under Section 11B was not challenged by the revenue before the first appellate authority, such a ground cannot be urged for the first time in an appeal before this Court. As a matter of fact, the ground was not even urged in the form of a cross objection before the Tribunal.
The assessee is the recipient of the taxable service provided by RGTIL and had borne the incidence of service tax. Hence, the assessee is entitled to claim a refund of excess service tax paid consequent upon the downward revision of the transmission charges payable by the assessee to RGTIL in terms of the determination made by the Regulatory Board.
The fact that the assessee has not passed on the burden has been amply established in the order of the adjudicating authority. - no merit in the case of revenue - Decided against the revenue.
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2014 (7) TMI 852
Health and Fitness service - sale of booklet - activity of teaching the art of yoga - Held that:- The booklet which is part of the appeal, titled as "Lifesaver" only gives the benefits of yoga and also gives the names of 20 asanas which were being taught in the Institution. Further we find that in the present appeal, in the brief facts which were duly verified by the appellants, it has been specifically mentioned that the appellants are a Trust registered under the Maharashtra State to teach the art of yoga as the yoga is therapeutic and restorative. In view of these facts, we find that the appellants are clearly providing a service as covered under ‘health and fitness service' - Decided against assessee.
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2014 (7) TMI 851
Penalty u/s 76 & 78 - Simultaneous penalty - Held that:- While High Courts of Kerala and Delhi opined that prior to the amendment w.e.f . 10.5.2008 by a proviso introduced to Section 78, by the Finance Act, 2008, penalties under Sections 76 and 78, which operate on different aspects could be imposed vide Assistant Commissioner of Central Excise Vs. Krishna Poduval - [2005 (10) TMI 279 - Kerala High Court] and Bajaj Travels Ltd. Vs. CST [2011 (8) TMI 423 - DELHI HIGH COURT], the Punjab & Haryana High Court in CCE Vs. First Flight Couriers Ltd. - [2011 (1) TMI 52 - High Court of Punjab and Haryana] recorded a contrary view, following its earlier judgement in CCE Vs. Pannu Property dealers [2010 (7) TMI 255 - PUNJAB AND HARYANA HIGH COURT] and on the ground that since Section 78 is more comprehensive and provide for a higher quantum of penalty, though technically the scope of Section 76 and 77 are different, penalty under Section 76 may not be justified where penalty is already imposed under Section 78. - Decided against Revenue.
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