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2016 (3) TMI 810 - AT - Service TaxSharing of resources and cost / expenses with the group companies - Business Support Services provided for the period 2006-07 and 2007-08 - Section 65(105)(zzzq) of the Finance Act, 1994 - Appellant providing services by way of accounting and processing of certain transaction and certain operational assistance as required by the Participating Group companies under an agreement between the appellant and the group companies - Held that:- the appellant is merely acting as a manager/trustee to incur expenses on behalf of the Participating Group Companies. The object of entering into such cost sharing arrangement is to reduce the cost of operation of the Participating Group Companies. The activities carried out by the Appellant enables the Participating Group Companies to share the common services, the best available talent and resources required for carrying out their business activities. No taxable service is provided by the appellant and therefore in absence of rendition of such service by the appellant to the Participating Group Companies, the demand of Service tax do not sustain as Service tax is a levy on rendition of taxable service. Demand of Service tax vis-a-vis Pure Agent - Rule 5(2) of Service Tax Valuation Rules - Held that:- the goods or services procured by the appellant for the use of Participating Group Companies are not availed by the Appellant for its own use or consumption, and he has no function or existence other than as Trustee / Manager (agent) of the Participating Group Companies cost sharing arrangement. - Therefore, the amount so recovered by the appellant is in the capacity of a Pure Agent and thus the same cannot be subjected to the Service tax followed by Pharmalinks Agency (I) Pvt. Ltd. Vs CCE [2014 (10) TMI 284 - CESTAT MUMBAI]. Availment of CENVAT Credit - CA certificate submitted providing details of the CENVAT Credit available during the period in question but was not noticed by the Adjudicating Authority - Held that:- even if the activities carried out by the appellant are subjected to Service tax, the Participating Group Companies who were duly registered with the Service tax authorities during the relevant period and were discharging Service tax on their activities, would be entitled to avail the CENVAT Credit thereof. Demand of Servive tax - Invokation of extended period of limitation - Held that:- by relying on the judgment of CCEx Vs Reclamation Welding Ltd. [2014 (8) TMI 186 - CESTAT AHMEDABAD], when recipient of same group company is eligible to avail the CENVAT Credit of the duty paid by the assessee, the assessee could not be alleged to have mala fide intent to evade payment of duty and accordingly extended period of limitation cannot be invoked. Therefore, the entire demand and any contrary finding recorded for invoking extended period, are liable to be set aside. - Decided in favour of appellant with consequential relief
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