TMI Blog2007 (10) TMI 135X X X X Extracts X X X X X X X X Extracts X X X X ..... ss Auxiliary Service for the period July'03 to March'05, confirmed against the appellants by the Commissioner of Service Tax, Chennai. Penalties imposed on the appellants under various provisions of the Finance Act, 1994 are also under challenge. In Appeal No. S/159/07, the appellants have prayed for setting aside a similar demand of service tax (over Rs.1.5crores) confirmed against them by the Commissioner in a separate order for the period 2005-06 as also for vacating the penalties imposed on them. We have taken up this appeal also for final disposal along with the above appeal, after dispensing with pre-deposit. 2. The appellants got themselves registered with the department as providers of Business Auxiliary Service w.e.f. 1- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter verification of their records and connected enquiries, the department took the view that the appellants should have paid service tax also on the reimbursements received by them from the bank towards staff salaries and infrastructural expenses incurred in connection with the rendering of Business Auxiliary Service to the bank. On this basis, show cause notices were issued by the department demanding differential tax from the appellants and proposing penalties on them. The SCN for the period July'03 to March'05 was issued on 25-11-05 and the one for the period 2005-06 was issued on 19-1-07. Both the notices invoked the larger period of limitation under the proviso to Section 73(1) of the Finance Act, 1994 on the ground of suppres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er the reimbur5emd1 received by the appellants from the bank, of salaries and infrastructural expenses were liable to be included in the taxable value of the Business Auxiliary Service for the purpose of payment of service tax. Another issue is whether the extended period of limitation was invocable in this case. 6. Section 67 of the Finance Act, 1994 defines 'value of taxable service' as the gross amount charged by the service provider for such service rendered by him. On the facts of the present case, the service charges collected by the appellants from the bank as consideration for the Business Auxiliary Service rendered by the former to the latter constitute the gross amount charged by the service provider for such service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... MAD STAT one of us sitting singly held, in respect of C F Agents Service, that Service tax was not leviable on expenditure reimbursed by the service recipient towards freight, labour, electricity, telephone etc. 7. Ld. Counsel for the present appellants has also relied on a few circulars of the Central Board of Excise and Customs. In F.No. B43/1/ dated 6-6-97, it was clarified, in respect of customs house agents' service and steamer agents' service, that reimbursements of expenses were not chargeable to service tax. In F. No. 343/5/97 dated 2-7-97, it was clarified, in relation to Consulting Engineers Service and Manpower Recruitment Agents' Service, that reimbursements of actual expenses were not subject t service tax. In ..... X X X X Extracts X X X X X X X X Extracts X X X X
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