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Service Tax - Case Laws
Showing 41 to 60 of 232 Records
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2017 (3) TMI 1417
Constitutional validity of amendments made in the FA, 1994 (Service Tax) by the FA, 2016, whereunder the Section 65B was amended, as being ultra vires the Constitution of India under Entry 34 and Entry 62 of List II of the Seventh Schedule of the Constitution of India - lottery - whether the transactions in buying and selling lottery tickets are not liable to Service tax under the provisions of the FA, 1994 as amended by the FA, 2016? - N/N. 18/2016-ST dated 01.03.2016.
Held that: - it is evident that the service tax was intended on promotion, marketing, organizing, selling of lottery or facilitating in organizing lottery of any kind, in any other manner. By the impugned amendment a cosmetic change has been made in the Amendment Act, 2010, as initially the words “any person or any other person” was used. In 2015, it was modified to the extent that any activity carried out, for a consideration, in relation to or for facilitation of, a transaction in money except an actionable claim excluding the activity carried out (a) by a lottery distributor or selling agent in relation to promotion, marketing, organizing, selling of lottery or facilitating in organizing lottery of any kind, in any other manner. The lottery distributor or selling agent is a person appointed or authorized by a State for the purpose of some activities.
Article 268A, which was incorporated by the Constitution (Eighty-eighth Amendment) Act of 2003, has recently been omitted by the Constitution (One Hundred and First Amendment) Act, 2016. Entry 92C was inserted by the same constitutional amendment, but admittedly never notified, as pleaded by the learned counsel appearing for the parties and the same has also been omitted by the Constitution (One Hundred and First Amendment) Act, 2016. Thus, reliance can be placed on Entry 97 invoking competence to impose service tax. However, Article 268C confers power and competence on the Union-Parliament to levy service tax on the service providers for consideration.
Union- Parliament is conferred with the power and competence under Article 268A read with Entry 97, List I (Union List) to impose and levy service tax on other related activities, as aforestated. The impugned amendment brought in Finance Act, 2016 is not unconstitutional.
When consideration is unascertainable for the services rendered by a distributor or selling agent, the service tax is not imposable and liable to be set aside.
The amendments carried out by the Finance Act, 2016, are not capable to being implemented for imposition and levy of the service tax on the services allegedly provided by the petitioners - petition allowed - decided partly in favor of petitioner.
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2017 (3) TMI 1416
Challenge to the Show Cause Notice (SCN) - Maintainability of petition - statutory remedy of appeal - it was submitted that the SCN is vague and has been issued on the basis of assumption. It does not contain any allegation that, the first petitioner is liable to pay Service Tax - manpower recruitment or agent service - providing services without obtaining registration - Held that: - Existence of a statutory alternative remedy is not a complete bar to the maintainability of a writ petition. The rule of exclusion of writ jurisdiction by availability of an alternative remedy is a rule of discretion and not one of compulsion - While examining an order passed by a statutory authority in a quasi judicial proceeding, the Writ Court is not called upon to sit in appeal over such order, reappraise the evidence and substitute the findings arrived at by the deciding authority with its own findings, unless it is substantiated that, the impugned findings are perverse or are contrary to public policy.
In the present case, it cannot be said that the authorities had acted without any basis in issuing a SCN. The SCN was issued on the basis of materials as narrated above. It is detailed. The department has valid reasons to issue the same. The charges are based on cogent materials and evidence. It does not violate any law. The petitioners have not been able to establish that, the department had violated any law in issuing the SCN or that the SCN contains any charges which is contrary to any law.
Petition dismissed - decided against petitioner.
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2017 (3) TMI 1415
Restoration of appeal - dismissal of appeal due to non-deposit of the outstanding service tax amount of ₹ 23,12,868/- within a period of eight weeks therefrom as pre-deposit - appellant submitted that the present pre-deposit requirement is 7.5% of the demand. The demand could not be said to be more than ₹ 23,12,868/- and, after the amendment, 7.5% of that could only be insisted upon as predeposit for the purposes of hearing of the appeal - Held that: - the appellant was ready and willing to put in the deposit of 7.5% of ₹ 23,12,868/- as pre-deposit for the purposes of hearing of the appeal - appeal restored with direction upon the appellant to deposit 7.5% of ₹ 23,12,868/- being the sum of ₹ 1,73,465/- within two weeks - appeal allowed - decided partly in favor of assessee.
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2017 (3) TMI 1414
Refund claim - Rule 5 of CCR read with N/N. 27/2012-CE(NT) dt. 18/06/2012 - rejection on the ground that the appellant had not taken registration - Held that: - The issue whether service tax registration is mandatory for refund of accumulated CENVAT credit of service tax has been finalised in the judgments mPortal India Wireless Solutions (P.) Ltd. Versus Commissioner of Service Tax [2011 (9) TMI 450 - KARNATAKA HIGH COURT], where it was held that Registration not compulsory for refund - the rejection of refund is unjustified - appeal allowed - decided in favor of appellant.
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2017 (3) TMI 1413
Liability of tax - reimbursable amounts which have been collected on the items like Security Guards, Videography Police, Escorts, DM/CMM charges etc. - Invoking expended period of limitation
Difference of opinion - Matter referred to larger bench.
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2017 (3) TMI 1371
Levy of tax - Construction services - The pradhikaran under Rajiv Awas Yojna and Jawaharlal Nehru Urban Renewal Mission had provided the small units to the juggi dwellers without any cost or highly subsidised cost - the M.P Government has constructed the accommodation for the gandi basti people under the Central sponsored scheme which is attempted to clean India as per Prima Minister’s mission - Held that: - N/N. 28/2010-ST dated 22nd June, 2010, clarified that the services is provided to Jawaharlal Nehru National Urban Renewal Mission and Rajiv Awaas Yojana are exempted from the clutches of service tax - Further, vide F. No. 137/26/206-CX-4 dated 5th July, 2006, it was clarified that service tax would not be leviable on construction of complexes under question if their lay out does not require approval by an authority under any law for the time being in force - From the letter dated 30.1.2004 issued by the M.P. Urban Development department, it appears that the said construction was made under “Rajiv Gandhi basti Vikas karyakram” which was the Central sponsored scheme and the same is exempted from service tax as per Circular No.125/2010-ST dated 30th July 2010 - tax not levied - appeal allowed - decided in favor of appellant.
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2017 (3) TMI 1370
Valuation - works contract - whether the free of cost material provided by the service receiver is required to be included in assessable value? - Held that: - an identical issue has come up before the Larger Bench of this Tribunal in the case of Bhayana Builders (P) Ltd. vs Commissioner of Service Tax, Delhi, [2013 (9) TMI 294 - CESTAT NEW DELHI (LB)], wherein the free material supplied by the service receiver was not included in the cost of the works contract.
Disallowance of Composition Scheme for works contract service - Held that: - the issue has come up for consideration before this Tribunal in the case of Ahluwalia Contracts (I) Ltd. vs Commissioner of Central Excise, [2015 (7) TMI 855 - CESTAT NEW DELHI], wherein the Tribunal has remanded the matter to the adjudicating authority for de novo adjudication.
Denial of exemption to the services provided to the SEZ Unit - Held that: - exemption under N/N. 4/2004-ST dated 31.03.2004 requires the approval of the SEZ developer/unit. The said approval was submitted by the assessee-Appellants, but the lower authorities have not taken any cognizance - matter needs remand for reconsideration.
Appeal allowed by way of remand.
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2017 (3) TMI 1369
Works contract - non-payment of service tax - the appellant has not been given the cum tax benefit, as no service tax was collected from service recipient M/s Jaya Jyothi Cements Pvt. Ltd. - Held that: - In the case of KNR Contractors [2010 (10) TMI 438 - CESTAT, BANGALORE], it is observed by the Tribunal that before proceeding to impose penalty the authority Is expected to ascertain whether the assessee has established reasonable grounds for failure/ default of the assessee. The matter was then remanded for considering the issue whether the benefit of Section 80 can be extended - In the present case, even after the conduct of investigation the appellant has not discharged the service tax liability along with interest, even though they were aware they are liable to pay the service tax.
When the appellant contends that they have to be given cum tax benefit, they cannot raise the contention that the service tax has not been received from the service recipient
The matter is remanded to the adjudicating authority to consider the issue of cum duty benefit only and revise the demand accordingly if eligible for the benefit. The penalties will then stand revised accordingly - appeal allowed in part by way of remand.
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2017 (3) TMI 1368
Rectification of mistake - The applicant's claim that the mistake that have crept into the order is that even though the applicant is entitled to the benefit prescribed under the first proviso to Section 78 of the FA, 1994, the Tribunal in its order has not extended the said benefit to the applicant - Held that: - such claim has never been raised since the proceeding for recovery of service tax initiated against the Appellant. Undisputedly also, the issue was neither raised before any of the forums nor before this Tribunal and sought to be raised for the first time through this rectification application - The present relief, which the applicant seeks through the rectification application, would be possible only in exercise of the power to review the order, by reassessing/reappreciation of the evidence and undertaking detail examination of the records - ROM application rejected.
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2017 (3) TMI 1367
Demand of tax under "Commercial Training and Coaching” services - extended period of limitation - Held that: - the appellant is mainly running courses leading to awarding of degrees by University of London and Allahabad Agriculture Institute, and which are recognised by certain Universities in India as mentioned in the brochure of AIU. However, the appellant itself does not issue any kind of diploma or degree, which is recognised by law for the time being in force. In other words, the appellant is not covered in the exclusions mentioned in Section 65(27) of the Act.
Extended period of limitation - Held that: - the Department has not been able to produce any substantial evidence to indicate that there has been wilful suppression with intent to evade the service tax on the part of the appellant. Consequently, the liability of service tax against the appellant cannot be confirmed beyond the period of one year preceding the date of SCN.
Appeal allowed by way of remand.
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2017 (3) TMI 1366
Business Auxiliary Services - liability of tax - export of service - Held that: - when the services were provided as per the instruction of a person located abroad, the destination of service has to be treated abroad. The destination has to be decided on the basis of place of consumption and not place of performance - the services have been provided to foreign entities as per the agreement entered into and the beneficiary is such foreign entities. The amount as consideration for such services was also paid by the said foreign entities in convertible foreign exchange. Therefore, the services rendered by the appellants are squarely covered by the Export of Service Rules and there is no service tax liability on them.
Reversal of CENVAT credit - Rule 6(3A) of CCR - Held that: - the value of exempted service was arrived at by the Original Authority as difference between sale price and cost of goods sold or 10% of the cost of goods sold whichever is more - in the absence of any other statutory formula to arrive at the quantum of Cenvat credit to be reversed on common input services, we find no impropriatory in the decision of the Original Authority in this regard - Regarding the contention of the Revenue that the appellant/assessee should not be allowed to utilize more than 20% of the total duty liability we note that there is no legal backing for such assertion.
Appeal allowed - decided in favor of assessee.
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2017 (3) TMI 1365
Mining work - appellant have undertaken the work of prospecting mineral deposit, de-watering of mineral, removal of over burden, raising of china clay exposed after removal of over burden and loading china clay - whether the activity of appellant will be classified under mining services or under Cargo Handling Service? - after the introduction of tax entry for ‘mining service’ the appellant were registered with the department and were discharging service tax applicable - Held that: - Having examined the scope of work undertaken by the appellant as mentioned in the SCN, we find that the same is covered under the tax entry under Section 65(105)(zzzy) of the Finance Act, 1994. The clarification dated 28.02.2007 issued by CBEC states that mining service covers cite formation and clearance, excavation and earth moving and various outsourced activities provided for mining - appeal allowed - decided in favor of appellant.
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2017 (3) TMI 1364
Refund claim - Rule 5 of CCR, 2004 - CENVAT credit lying unutilised - Call centre services - Back office data processing services - denial on the ground that Revenue could not identify the specific classification of services rendered by the appellant to the foreign affiliates and as such these services were held as non-taxable - Held that: - on the same set of facts the Department sanctioned refund claims for the subsequent periods and accepted the fact that the appellants are providing taxable service for foreign clients and the accumulated Cenvat credit availed on input services are to be refunded to them. On this ground alone, the stand taken by the lower Authorities in the impugned order is liable to be set aside - matter is remanded back to the Original Authority who will examine the claim for sanction - appeal allowed by way of remand.
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2017 (3) TMI 1295
Marketing Services - the assessee-Appellants had multi facet business activities. When the imported crude oil was sold in the high sea, then there was a transaction of buyer and seller. When the assessee-Appellants got cleared the goods at the port, then they acted as C&F agent. So whatever charges were there, they were collected from the importer and paid tax thereupon - The Department is of the view that the assessee-Appellants had collected the charges for “marketing services” by raising debit notes and were not paying the Service Tax thereupon - Held that: - In addition to clearing and forwarding charges, the assessee-Appellants had further collected the payment from various clients to promote their products, this amount is nothing but is the receipt from various clients to promote their products. When the assessee-Appellants had no relationship with the imported goods, then the services provided by them were nothing else but marketing services. When it is so, then we find no reason to interfere with the impugned order - appeal dismissed - decided against appellant-assessee.
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2017 (3) TMI 1294
Club or association services to employees - Held that: - the identical issue has come up before the Hon’ble High Court of Jharkhand in the case of Madras Race Club Versus Commissioner of Service Tax, Chennai [2008 (9) TMI 199 - CESTAT, CHENNAI], where it was held that another part of the demand is on the amount collected by the club from its members for use of amenities provided by the club - appeal allowed - decided in favor of appellant.
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2017 (3) TMI 1293
Security agency service provided by the society of ex-serviceman - commercial concern or not - tax entry section 65(105)(w) - Held that: - the services rendered are squarely covered by the tax entry and we see no merits in the pleas of the appellant in this regard. The lower authority examined the issue in detail and we find no ground in the present appeal to interfere with the findings. Similarly, the appellants are covered for tax liability for the whole period of demand is clear from their legal status and financial accounts to the effect that they are, infact, involved in profitable commercial activity. It is clear from the bylaws of the society which clearly stipulates about net profit - there is no justification to hold the appellant as anything other than commercial entity.
It is clear that the appellants did not provide the required details and come forward with full facts during the course of audit during subsequent inquiry conducted by the department. Even at the time of filing regular ST 3 return, the appellant did not show the full gross amount received from the clients for providing taxable service. Considering these facts as recorded in the impugned order, the demand is sustainable for the full period.
Penalties - Held that: - there is reasonable cause for non payment of Service tax during the material time. Considering the background of operation of assessee and also circumstances pleaded by the appellant in appeal, we find it fit and proper to waive the penalties imposed on the appellant, invoking the provisions of section 80 as available during material time.
Appeal allowed - decided partly in favor of appellant.
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2017 (3) TMI 1292
Transfer of the right to the use of the trade mark - intellectual property service - whether penalty is imposable, where the short levied duty is already deposited by the assessee before issue of SCN? - Held that: - In the case of Union of India Vs. TPL Industries Ltd. [2007 (3) TMI 71 - HIGH COURT, RAJASTHAN], the Hon’ble Rajasthan High Court has held that no penalty amount charged from assessee for non payment of duty - no penalty will be leviable on the appellant - appeal allowed - decided in favor of appellant.
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2017 (3) TMI 1291
Exemption under notification no. 12/2013 dated 01.07.2003 - bullet proofing services - the vehicles in issue are supplied by the customer and on such vehicles, bullet proofing is done by the appellant. This activity is amounting to production. On the material portion used VAT is paid - whether benefit of notification is to be extended to appellant or not? - Held that: - the material where the VAT has already been paid cannot be brought to the service tax levy; otherwise it would amount to double taxation. However, where the VAT is not paid the value of the goods as well as the service is subject to the service tax - the adjudicating authority is to ascertain where VAT has been paid and in those cases value of the component will be excluded and wherever the VAT is not paid that can be brought under the clutch of the service tax including the value of the goods as well as the service - appeal allowed by way of remand.
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2017 (3) TMI 1290
Levy of tax - lease agreement - lease of services falling under man power recruitment or supply agency services - time limitation - Held that: - the fact of leasing of the factory was very much in the knowledge of the Revenue and in fact based upon the same earlier show cause notices were issued to them raising demands though under different categories and different situation. However, the said fact establishes that there was no suppression or malafide on the part of the appellant with any malafide intention. As such, the longer period of limitation is not available to the Revenue - entire demand is barred by limitation - appeal allowed by way of remand.
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2017 (3) TMI 1289
Benefit of N/N. 14/2004-ST dated 10.09.2004 and 13/2003-ST dated 20.06.2003 - The department is of the view that, process of de-husking is not an agricultural activity so, no exemption can be granted - Held that: - Board has issued a Circular, No. 143/12/2011-ST dated 26.05.2011, where the benefit was provided to raw cashew, tobacco leaves etc. and the same were considered in relation to agriculture. Needless to mention that in the cashew, kernel is removed and in the instant case, the husk is removed. So both the cases are on the same footing. By considering the Notifications, Circulars and clarifications, we are of the view that de-husking of the paddy is covered in relation to the agricultural activity hence, the service tax is not applicable on such activity - demand set aside.
Levy of tax - brokerage and commission - payment to the agents in foreign currency - Held that: - as per Board Circular No. 143/12/2011-ST dated 26.05.2011, it is clarified that the commission agents stationed abroad provide business auxiliary service to promote the export of rice, said business auxiliary service is covered by Notification 13/2003-ST (as amended) because, the word ‘rice’ is mentioned under the explanation to the term ‘agricultural produce’, in the inclusive portion along with other items like cereals, pulses, etc - demand set aside.
Clearing and Forwarding services in relation to export of rice - Held that: - the said payment was made under the head of ‘Clearing and Forwarding services’ which includes the ‘freight charges’ - demand upheld.
Appeal allowed - decided partly in favor of appellant.
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