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2018 (7) TMI 1291 - AT - Service TaxLiability of Service Tax - SIM Cards given free of cost to the distributors without any consideration - telecommunication services - Rule 5(1) of Determination of Value Rules Held that:- Rule 5(1) and the explanation thereof were practically disjoint, these were used as independent Rules and thus the explanation does not attain any clarificatory nature. It is difficult to consider it retrospectively applicable. The fact for the present case still remains is that the SIM Cards which the distributor received as free, has been sold on MRP, and since the MRP is inclusive of prices, therefore, demand has to be calculated by taking MRP as cum tax value in terms of Section 67(2) of the Finance Act, 1994 - demand upheld. Demand of Interest and penalties - extended period of limitation - Held that:- The adjudicating authority has rightly observed noticee to have already been registered with the Department and as such to already been well aware of the provisions of Service Tax, still not disclosing the taxable value of the SIM Cards supplied free of cost to the distributors in their returns nor paying the tax thereupon without seeking any clarification to that effect is sufficiently a positive act which constitutes suppression of facts - the Department was well entitled to invoke the extended period of limitation - demand of interest and penalties also upheld. Appeal dismissed - decided against appellant.
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