TMI Blog2014 (11) TMI 250X X X X Extracts X X X X X X X X Extracts X X X X ..... give limit/overdraft facility, the bank keeps the fund available for the same. Under such circumstances, it is evident that such charges are integrally connected with the lending which is a taxable service. Therefore, commitment charges cannot be separated from lending service. I, therefore, hold that the commitment charges are chargeable to service tax and the amount of ₹ 46,902/- is recoverable from them. - Decided against assessee. - Appeal No. ST/50483/2014- ST[SM] - Final Order No. 53834 - Dated:- 8-10-2014 - Sh. Manmohan Singh, J. For the Appellant : Ms. Rinki Arora, Advocate For the Respondent : Sh. B. B. Sharma, DR JUDGEMENT Per Manmohan Singh: The appellant have come in appeal against the Order- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e case and appellants have no case for dropping the demand. 3. Heard both the sides and perused the records. 4. The short point for consideration is whether commitment charges recovered by the Bank are to be added to the taxable service for charging service tax or these charges are to be treated as interest and no service tax was to be levied on such charges. I find that the issue is clearly covered by the Tribunals judgment in case of Housing Development Corporation Ltd.(Supra). Paragraph 19.2, 19.3 and 20 of the judgment are very relevant and reproduced for ready reference:- 19.2 Appellant has contended that in the clarification issued by the Board vide Letter F. No. B-11/1/2001-TRI, dt. 09.07.2001, it has been h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ide intention on their part to evade payment of Service Tax. Revenue relied upon the decision of the Tribunal in the case of Bharat Petro Corporation Ltd. Vs. CCE, Nasik, reported in 2009(242) ELT-358(Tri. Mum.)wherein the Tribunal upheld the submission that BPCL is a Government owned company had suppressed the fact and therefore, just because it is wholly owned Govt. Company, it cannot be said that bona fide can be presumed. He also submitted that blind belief cannot be a ground for non-payment of taxes. In this case, we find that the appellants have treated the amount of prepayment charges as additional interest and reset charges as additional interest from 2005-06. It was also submitted that Income Tax Department has accepted such treatm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decision of the Tribunal in the case of SPIE CAPAG S.A. Vs. CCE Mumbai, reported in 2009(243) ELT-50 (Tri. Mum.), is appropriate. In that case, while dealing with the plea of bona fide belief, the Tribunal observed that the least that was expected of the appellant to discharge the plea of bona fide belief was to make enquiries from Central Excise authorities or some reputed legal firm regarding dutiability of items manufactured buy it. Therefore, we find ourselves in agreement with the submissions that the appellant could not have interpreted the law according to their understanding without taking sufficient care for their interpretation, is correct. In the absence of any evidence to show that the appellant had intimated the Department o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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