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2021 (3) TMI 614 - AT - Service TaxValuation - inclusion in taxable services or not - expense incurred by the agents, namely, travel, conveyance and vehicle running expenses, training expenses, printing and stationary, and business development/marketing and sales promotion expenses - adjustment of service tax amount initially paid by the appellant under rule 2(1)(d)(iii) of Service Tax Rules, 1994 with the commission paid to the agents to be deposited under Section 73A(2) of the Finance Act, 1994. Whether the expense incurred by the agents, namely, travel, conveyance and vehicle running expenses, training expenses, printing and stationary, and business development/marketing and sales promotion expenses are to be part of the gross taxable value in discharging service tax by the appellant? - HELD THAT:- The expenses incurred by the insurance agents are proposed to be included and under Rule 5(1) of the Service Tax (Determination of Value) Rules, 2006 which was in force during the relevant time. The said Rule 5(1) has been struck down by the Hon’ble Delhi High Court as ultra vires to Section 66 and 67 of Finance Act, 1994 and the said judgement has been upheld by the Hon’ble Supreme Court in Intercontinental Consultants and Technocrats Pvt Ltd case [2018 (3) TMI 357 - SUPREME COURT] - thus confirmation of demand by the adjudicating authority by including the reimbursable expenses in the gross taxable value cannot be sustained. Whether the service tax amount initially paid by the appellant under rule 2(1)(d)(iii) of Service Tax Rules, 1994 and later adjusted with the commission paid to the agents to be deposited under Section 73A(2) of the Finance Act, 1994? - HELD THAT:- The issue has been addressed at length by this Tribunal in Bajaj Allianz Life Insurance Company Ltd [2019 (6) TMI 104 - CESTAT MUMBAI] where this Tribunal held that The service tax initially paid by the Appellants and later collected from the insurance agents by adjusting the commission paid, cannot be directed to be deposited under Section 73A(2) of Finance Act, 1994. Appeal allowed - decided in favor of appellant.
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