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Service Tax - Case Laws
Showing 21 to 40 of 145 Records
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2016 (1) TMI 1130
Refund claim - unutilized Cenvat credit lying in the Cenvat Credit account - Air Travel Agent's Service, Architect Service, Business Auxiliary Service, Business Support Service, Banking and Financial Services, Courier Service, Chartered Accountant Services, Commercial Training & Coaching Service, Event Management Service, Erection, Commissioning Installation, General Insurance Service For Employees, Health Service, Interior Decorator, Information Technology Software Service, Legal Service, Management, Maintenance & Repairs Service, Management Consultancy Service, Manpower Recruitment & Supply Agency Service, Pandal & Shamiana Service, Renting of Immovable Property Service Rent and Amenities/ Facilities, Outdoor Catering Service, Online Information & Database Service, Real Estate Agent Service, Testing Inspection & Cetification Service, Works Contract Service - export of output services - availed credit of service tax paid on their input services utilized for providing output services - nexus between input and output services.
Held that:- all the services are essential services for providing output services. Appellants are exclusively engaged in export of services and no service are provided domestically. Therefore use of all the above services and expenditure thereof born by the appellant are essential services for providing output services. In my prima facie view, appellants are entitle for refund of service tax paid on the above input services in view of various judgments of Hon'ble High Court and Tribunal. I have also observed that in some of the similar services appellants have been sanctioned refund claim therefore in the present case on the same services rejection of refund claim is not legal and proper.
As regard appeal No. ST/ 85008/ 15-MUM for the period April, 2010 to June, 2010 of Thane unit wherein credit was availed on the capital goods for an amount of ₹ 1,24,924/- , I find that as per the Rule 5 and Notification No. 5/2006-CE(NT) issued thereunder refund is eligible only in respect of excise duty/ service tax suffered on input/ input services used in export of goods, refund of excise duty paid on capital goods is not admissible in terms of Rule 5 of the CC Rules, 2004 and Notification issued there under. This position has been fairly conceded by the Ld. Counsel therefore Appeal No. ST/ 85008/ 15-MUM liable to be dismissed. - Partly appeals disposed of by way of remand
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2016 (1) TMI 1101
Extension of stay - Whether Hon'ble CESTAT was right in holding that as per the third proviso to Section 35C(2A) of the Central Excise Act, 1944, it has got the power to grant extension of stay beyond 365 days from the initial grant of an order of stay - Demand of Service tax along with interest and penalty - Business auxilliary service - Not disclosed the fact of providing this service - Held that:- in view of the decisions of various High Courts in various case laws, wherever the appeal could not be decided by the Tribunal due to pressure of pendency of cases and the delay in disposal of the appeal is not attributable to the assessee in any manner, the interim protection can continue beyond 365 days in deserving cases. - Decided against the revenue
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2016 (1) TMI 1066
Taxability of services - Nature of activity - transfer of right to use goods - effective control and possession of the subject System stands transferred to the Customer - services for the provision of automated, online ID and 2D bar code printing system, labeling application system, aggregation system and dispatch system in accordance with ESCIMS standard operating procedures for distilleries, breweries and wineries. - to provide for a System comprising of a complete set of various machines/ equipments which are installed and commissioned by the applicant as per ESCIMS.
Customer is responsible for the operational maintenance of all 4 sub-systems of main Systems i.e. printing, labelling, aggregation and dispatching, as also daily maintenance, whereas SICPA is to look after other than daily maintenance. In nut-shell, Schedule 6 to the Agreement makes it clear that operation and operational maintenance of the System is the responsibility of the customer.
Revenue has not explained as to how the cost of consumables etc. paid by the customer to the applicant as fees, would not transfer the right to use the System to the Customer and effective control will remain with SICPA/applicant. It is observed from perusal of scope of the Agreement that it also involves supply of consumables, which constitute a part of value/consideration. Further, transfer of right to use goods, shall not include service(s). In view of above, contention of Revenue is not tenable.
The phrase "grant of license to use the System on a non-exclusive basis" (clause 2.1.2 to the Agreement) is used for the reason that the proprietary / intellectual property used in the System is utilized by the applicant in other similarly placed transaction with other customers. However, the use of System by the customer is on exclusive basis.
The activity proposed to be undertaken by applicant is not liable to Service Tax under the provisions of the Finance Act, 1994. - Decided in favor of assessee.
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2016 (1) TMI 1065
Nature of agreement - sales agreement or service agreement - activity: "proposed IDEAS Oman will be selling educational books and printed manuals for onward sale to organizations in India via Creative Problem Solving India, Mumbai" - applicant stresses on the wording of the proposed activity which is purely a selling activity - Held that:- The clause is more than clear that the Distributor would have to bear apart from the price of the books, the shipping, handling, rush, and other charges. We do not see as to how this amounts to any ‘service’ particularly by IDEAS to the Distributor applicant.
It is clear that the Distributor applicant has not asked any question about whether there is any service provided by IDEAS to the Distributor. The question is very simple and clear as to whether the sale of the books to the Indian entities involves any ‘service’ and would attract the service tax liability. The answer is clearly in negative. - Demand set aside - Decided in favor of assessee.
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2016 (1) TMI 1064
Tribunal dismissed the appeal for non-compliance of the conditional order of stay. - appellant contended that the Tribunal is not justified in passing the impugned order, when, prima facie, the demand itself is not justified, by virtue of the Board's Circular, dated 06.08.2008. - Demand of services tax on loading or unloading activities being provided in relation to GTA service
Held that:- Despite the request being made, seeking modification of the order of stay, the Tribunal did not consider the same, but only extended the time. When the CENVAT credit was available with the Revenue, which would safeguard the interest, insistence upon the further deposit would cause undue hardship to the appellant and as such, the appellant has established a prima facie case for their claim of waiver of pre-deposit. Though complete waiver cannot be granted, having regard to the demand made by the Department, the Tribunal should have considered the reduction of pre-deposit already ordered, having regard to the availability of CENVAT credit to the extent of ₹ 77,00,000/-. But that has not been done.
The appellant shall deposit a sum of ₹ 10,00,000/- (Rupees ten lakhs only) to the credit of the second respondent within a period of four weeks from the date of receipt of a copy of this judgment - on such deposit being made, the Tribunal shall take the appeal - Decided in favor of assessee
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2016 (1) TMI 1063
Cenvat Credit - input services - Service Tax paid on commission amount paid to dealers/stockist - nexus with manufacturing activity - Whether the activities undertaken by the service provider were in nature of sales promotion activity? - Held that:- predominantly the entire agreement was one in the nature of appointing a partnership firm as stockist of the appellant company who would upon being supplied the goods in question would store the same and dispose of in the market at agreed rates upon which would receive certain commission. - A fleeting reference to attempt to sales promotion would not change the very basic nature of agreement and the relations between the appellant and the stockist converting the stockist as sales promotion agent.
Payment to the agents appointed by the appellant would not be eligible for cenvat credit. - Decided against the assessee.
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2016 (1) TMI 1062
Renting of immovable property on profit sharing basis - demand of service tax on renting including on notional interest received on the security deposit made with the appellants. - Held that:- As the issue has already been settled in appellants own case for earlier period, that the appellant is not liable to pay service tax under the category of renting of immovable property service as leasing out the property to Hotel under the deemed provision of section 65 (105)(zzz) of the Finance Act, 1994. Therefore, we hold that appellant is not liable to pay service tax under the renting of immovable property service. - Further, appellant are not liable to pay service tax on the notional interest accrued on the security deposit. - Demand set aside - Decided in favor of assessee.
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2016 (1) TMI 1053
Manufacturing activity or service - repair and maintenance of the equipments so that the same can be re-used without requiring replacement - The equipments repaired are generally 3-7 years old or are damaged due to transportation or due to fire / floods / rains or are not working efficiently due to any technical defect etc. - Held that:- The activity of repair and maintenance proposed to be undertaken by the applicant will not amount to manufacture within the meaning of section 2(f) of the Central Excise Act, 1944.
Eligibility to avail CENVAT credit of Excise Duty - parts and spares used for the replacement of the defective ones and Service Tax paid on inspection, certification, engineering services etc. for the aforesaid repair and maintenance activities and claim set off against the output service tax paid for rendering of passive infrastructure services by the Applicant to its customers - Held that:- The applicant is eligible to avail Cenvat Credit of Excise Duty under the Central Excise Act, 1944 / Additional Duty of Excise under Section 3(1) of the Customs Tariff Act, 1975 paid on parts and spares used for their replacement of the defective ones and Service Tax paid on inspection, Certification and engineering services etc. for the aforesaid repair and maintenance activities and claim set off against the output service tax paid for rendering of passive infrastructure service by the applicant to its customers.
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2016 (1) TMI 1017
Outdoor caring services - appellant provided coffee vending machine in corporate sector to provide coffee to the employees thereof - Held that:- This prima facie brings the appellant to the character of caterer. - Prima facie, keeping in view, the abatement pleaded is in question and also the plea that VAT has been paid, which is altogether levied under a different statute not touching the service, as well as the revenue's interest, we direct the appellant to deposit ₹ 15,00,000/- (Rupees fifteen lakhs only) within eight weeks from today and make compliance on 22.1.2016. - stay granted partly.
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2016 (1) TMI 1016
Valuation - inclusion of amount charged towards Study Material Package (SMP) supplied to students - coaching centre and Franchise service - Held that:- It is not disputed that the appellant has shown the sale of value of study material separately in the invoice. The only argument raised is that these textbooks do not qualify as Standard Textbooks as clarified in the Board's circular. The Tribunal in the case of M/s. Cerebral Learning Solutions Pvt.Ltd. [2013 (4) TMI 527 - CESTAT NEW DELHI] had occasion to consider similar issue and held that the clarification issued by the Board's circular No.59/8/2003 dt.20.6.2003 is illegal and contrary to the statutory exemption granted by the notification. The said judgement squarely covers the issue in the present case. - Decided in favor of assessee.
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2016 (1) TMI 1015
Mandap Keeper services - appellants had availed exemption under Notification No. 12/2003-ST dated 20.6.2003 - short payment of service tax - It is urged by the counsel that prior to this amendment, marriage being a religious function would not fall into the category of social function mentioned in the definition - Held that:- . It is seen that though appellant had pleaded this ground before the authority below, the same has not been considered taking the view that Krishnapur Mutt is a temple and the premises is used for religious purposes only. We are not able to fully agree with this view taken by the Commissioner (Appeals) Marriages whether conducted in a premises of temple or in the premises of a hotel have the same character. Marriage functions cannot be differential on the premises where they are conducted. After 16.5.2007 marriages have been expressly brought within the ambit of social functions. This necessary implies that marriages having taint of religious function was outside the purview of definition of Mandap Keeper prior to 16.5.2007. However, the plea has to be established by the appellant by documentary evidence that the functions conducted during the period was marriage functions and not subject to levy of service tax. We therefore, are of the considered opinion that this is a fit case for remand.
In view thereof, the case is remanded to the adjudicating authority for de novo adjudication directing the authority to consider all the pleas raised by the appellant.
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2016 (1) TMI 1014
Job work - Business Auxiliary services - Default in discharging their service tax liability even though they continued to bill their principals for service tax. - financial difficulties - The appellant claims that their activity is manufacture and hence not liable to be taxed as "business auxiliary service", that they were eligible for exemption under notification no. 8/2005-ST dated 01/03/2005.
Held that:- appellant had applied for registration as provider of ''business auxiliary services"; rendering of job-work is one of the activities within its ambit. At no stage have they contended that this was a classification decided upon by tax authorities. Having registered themselves as a service provider and paid taxes as provider of "business auxiliary service" for a certain period, they are bereft of any ground to claim error in classification.
In the absence of any justification, procedurally or substantively, to seek a revisit of classification of the service rendered by the appellant, there is no legal provision to do so. The plea of taxability and any exemption from service tax is irrelevant in the context of the inclusion of service tax in the amounts billed to their principals as job-work charges.
It is seen that the appellant has collected service tax along with consideration from its principals for service rendered but failed to deposit the same in the government account. By this act of omission, the plea of leniency in the matter of penalties will not evoke a sympathetic response - demand confirmed.
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2016 (1) TMI 1013
Export of services in relation of import of goods - commission received from the foreign suppliers in respect of the imports into India - The Indian buyers made payments directly to the foreign seller and the foreign seller paid commission to the appellant. In some cases buyers opted to pay the commission directly to the appellant and in such cases commission part shown in the invoice was not paid on to the seller by the buyer. - Held that:- In case of the commission received from foreign supplier for procuring orders from the Indian buyers to whom the goods were directly supplied by the foreign supplier, the service rendered clearly satisfies the requirement of the same being the export of service.
In the case of J. B. Boda [1996 (10) TMI 70 - SUPREME Court] the Supreme Court has deemed such payments to be in foreign exchange. Thus we find that the issue is covered in the appellant’s favour by the judgment of CESTAT in the case of Paul Merchants [2012 (12) TMI 424 - CESTAT, DELHI (LB)] read with judgement of the Supreme Court in the case of J. B. Boda. - Demand set aside - Decided in favor of assessee.
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2016 (1) TMI 975
Classification of service - Business Auxiliary Service (BAS) or Clearing and Forwarding agent (C&F) service - appellant had promoted the business of the Principal. He was contributory to the growth of the business of the principal procuring orders for him and also exploring potential customers and channelized the purchase orders. - Held that:- Law is well settled that the scope of taxing entry is to be strictly construed and there is no intendment about tax. The facts and circumstances of the case warrant to bring the activity carried out by the appellant as per agreement to the scope of “Business Auxiliary Service” (BAS). This satisfies the principle of classification laid down in Section 66 of the Finance Act, 1994, excludes the other category of classification claimed by Revenue for the reason that the taxing entry most specifically attracts an activity shall bring that service into the same class and no other class by any remote construction - Decided in favor of assessee.
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2016 (1) TMI 974
Classification of Import of services from M/s. Society for Worldwide Interbank Financial Telecommunication (SWIFT) which is a non-resident entity, not having an office in India - reverse charge - service involved is transfer of information and also includes data processing - Banking and Other Financial Services or not - Held that:- We find that the very same issue has been decided by this Tribunal in the case of Bank of Baroda vs. Commissioner of Service Tax, Mumbai [2016 (1) TMI 767 - CESTAT MUMBAI] - the Assessees' these appeals are partly allowed
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2016 (1) TMI 973
Business Auxiliary service or not - activity of collection/dispatch of Speed Post/Export Delivery Letter etc. on behalf of the Post Office - Revenue neutral exercise - Held that:- Before going into the merit whether the services is taxable or otherwise and also on the limitation, we find that the fact is not under dispute that the services provided by the assessee is at the most considered as input services for the postal department. The postal department is admittedly paying the service tax on the total value of the services which obviously includes service value of the assessee. In this situation, if service tax is paid by the assessee, the assessee's services is an input service for the postal department and postal department is entitled for Cenvat credit, thus in our view the present case is of Revenue neutral as the postal department is entitled for CENVAT credit of the service tax if at all payable by the assessee. This Tribunal, time and again held that in case of revenue neutral the demand does not exist.
In view of the various judgments, it is clear that if service tax is paid by the assessee, same shall be available as Cenvat credit to the postal department and to that extent net liability of service tax shall stand reduced while paying the service tax by the postal department. Therefore, it is an exercise of revenue neutral for this reason demand does not exist. We, therefore, drop the demand on the point of revenue neutrality without addressing the issues of taxability of service tax and limitation. - Decided in favor of assessee.
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2016 (1) TMI 972
Cenvat Credit - demand of 8% on value of Exempted services - Rule 6(3)(i) of the Cenvat Credit Rules, 2004 - appellants had not filed a declaration under Rule 6(3A) - It is urged that unreasonable result cannot be intended by the legislature - The appellants have already reversed the CEnvat credit of ₹ 5,06,736/- attributable to input services used in providing exempted services during the financial year 2008-09 along with the interest of ₹ 21,658/-. - Reversal was not on monthly basis.
Held that:- It is evident that the condition of filing the declaration is only directory and not mandatory. Further, most of the requirements under Rule 6(3A) like, name, address and registration no. of the assessee, description of taxable services and exempted services, CENVAT Credit of inputs and input services lying in balance as on the date of exercising option, are already available in the records of the Revenue. We further find it is an admitted fact that the assessee herein have calculated the CENVAT Credit in terms of clause (c) read with clause (h) and have deposited the amount so determined, by 30 th June in the succeeding financial year as prescribed.
There is no dispute with regard to the CENVAT Credit reworked by the assessee which is attributable to the exempted output services. Further, there is merit in the contention of the assessee that Rule 6 cannot be used as tool of oppression to extract the amount which is much beyond the remedial measure and what cannot be collected directly, cannot be collected indirectly, as well.
In case of substantive compliance made by the assessee i.e. calculation of the amount of CENVAT Credit reversible on annual basis and payment of the amount before the prescribed date, the substantial benefit cannot be denied. We also hold that in the garb of Rule 6, the provisions of Section 93 of the Finance Act, 1994 cannot be overridden and/or the exemption provided under the Section 93 of the Finance Act, 1994 cannot be negated by the Cenvat Credit Rules, which is a delegated legislation and subservient to the main Act.
Demand set aside - Decided in favor of assessee.
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2016 (1) TMI 971
Nature of activity - collection of octroi on behalf of the Municipal Corporation - cash management activity or not - Banking and other Financial Services - Rectification of mistake for disposal - appeal was dismissed because of low tax effect - Held that:- we find that by our final order dated 11.08.2015 we have disposed of the appeal recording therein that the amount involved in this case is less than ₹ 5 lakhs, factually it is incorrect. Accordingly, we recall our final order No. A/2637/15/STB dated 11.08.2015 and restore the appeal to its original numbers and take up the same for disposal.
The amount collected excess of contracted amount and retained by the assessee in respect of transit fees is not covered under the category of "banking and other financial services'. Since the issue is decided in favour of the respondent-assessee in this appeal, we find no merit in the appeal filed by the Revenue and hold that the impugned order is correct and legal and does not suffer from ay infirmity. - Decided against the revenue.
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2016 (1) TMI 928
Service Tax Dispute - Settlement Commission rejected the application - The Petitioners say that since they had accepted that there was a short payment of service tax and interest, in addition to filing periodical returns as required, the Petitioners approached the Settlement Commission for a settlement of the dispute - The Settlement Commission purported to note that the Petitioners did not have sufficient supporting documentation.
Held that:- Settlement Commission has plenary powers to summon and take evidence. If there was any doubt about this, it is completely set at rest by the plain wording of Section 32-L(2) which speaks specifically of the Central Excise Officer being entitled to use all the materials and information produced by a petitioner before the Settlement Commission, “or the result of the enquiry held or evidence recorded” by the Settlement Commission in the course of proceedings before it “as if such materials, information, enquiry and evidence had been produced before such Central Excise Officer or held or recorded by him in the course of proceedings before him”. For the Respondents to say, therefore, in paragraph 2 that the Settlement Commission is “not a forum for evaluating evidence or deciding a matter involving complicated issues of facts and law” is clearly incorrect.
We will assume for the purpose of this Petition that a copy of the Revenue’s report was in fact made available to the Petitioners. We find, however, that the Petitioner was given no opportunity of meeting it. The Settlement Commission seems to have straightaway accepted that Report not only as gospel, but as totally incontrovertible, and incapable of being subjected to any rational settlement. There is absolutely no basis for this, other than the Settlement Commission saying, to all intents and purposes, that the matter is apparently too onerous and too taxing on the Settlement Commission’s time, energy and resources. This is wholly unacceptable. The very least the Settlement Commission ought to have done, in our view, was to give the Petitioner an opportunity to respond to the Revenue’s observations and Report. Had the Petitioners then failed to do so, or if, on a close examination, that response was found on merits to be without substance, the application could have been dealt with accordingly. But to deny that opportunity and to thereby short-circuit a properly brought Settlement Case in this fashion is not, in our view, in keeping with the statutory mandate at all.
We are satisfied that there has been a fatal violation of the principles of natural justice. We are also satisfied that the Settlement Commission has not proceeded in accordance with its statutory mandate under Chapter V of the CEA. We specifically reject and repeal the reason given by the Settlement Commission that it cannot take evidence or that, when confronted with conflicting submissions on facts and law, its only recourse is to dismiss a settlement application brought before it. Nothing could be further from the statutory intent.
The Petition succeeds in part. - Matter restored before the Settlement Commission for a fresh consideration.
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2016 (1) TMI 927
Condonation of delay in filing of appeal before Commissioner (appeals) - delay of 104 days - Held that:- law is the Commissioner and the High Court has no power to admit an appeal where it is filed beyond the statutory time limit prescribed in the statute including the condonable period. Though the ‘Order' passed in ITC Ltd. [1990 (8) TMI 173 - SUPREME COURT OF INDIA] is strongly relied on by the appellant, the same is not applicable as the said ‘Order' was passed considering the peculiar facts and circumstances of the said case and in view of the concession made on behalf of the Revenue as evident from paragraph 1 of the said ‘Order'. - Delay cannot be condoned - Decided against the assessee.
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