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2013 (8) TMI 149 - AT - Service TaxBusiness Auxiliary service - Revenue proceeded against the assessee for having provided ‘Business Auxiliary Service’; for failure to obtain registration and filing returns disclosing amounts received from the taxable service - Commission received from M/s Fashion Suitings Pvt. Ltd., Bhilwara Rajasthan (for short FSL), for providing the Business Auxiliary Service of promotion and marketing of FSL products – Held that:- On analysis of the terms and conditions of similar agreements between the FSL and the petitioners, the adjudicating authority confirmed the tax liability against the appellants. We are satisfied that RCM (Right Concept Marketing) Business Marketing Plan is neither a new arrangement nor there is any concept of dividends as suggested by the Ld. Counsel. This is a clear Multilevel Marketing Service Scheme. The consideration/commission received by the appellants from FSL (this fact is not disputed) is the result of the marketing/promotion of FSL products by the appellants and constitutes a service (Business Auxiliary Service), provided in respect of FSL products to FSL. The commission/consideration is provided according to the terms and conditions, for marketing/promotion efforts by the appellants. The receipt of commission by the appellants clearly makes them providers of Business Auxiliary Service as defined under Section 65 (19) of the Act Penalty under Section 76 of the service tax act – Held that:- Imposition of penalties on the appellants is not sustainable as the appellants were under the bona-fide belief that the service provided by them was not Business Auxiliary Service . We are unable to accept this contention as we discern no ambiguity in the statutory definition of Business Auxiliary service that could have sustained on given rise to any bona-fide belief as to the activities of the appellants being not Business Auxiliary Service – Decided against the Assessee.
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