9911796707
TMI Blog2017 (3) TMI 118X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. Heard both sides and perused the records. 3. During the course of Audit, it was noticed that, during the period 2009-10 to 2010-11, respondent had paid Bank Guarantee Fees and LC (Letter of Credit) charges to their associated Companies viz. M/s Sungwoo, Korea & M/s. Gestamp, Spain, for a loan availed by themselves in India. It appeared that the services provided by these foreign associates in the nature of extending Corporate guarantee and LC to the respondent, for which the latter paid them charges/fees, is classifiable under the category of Business Support Services (hereinafter referred to as BSS) and liable to service tax. 3.1 The respondents had not considered the gross value of the services received by them from M/s Sungwoo, Ko ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ming of service tax liability of Rs. 15,37,327/- while the assessee-appellant was contesting the imposition of penalties under various Sections, claiming that having discharged the service tax liability on being pointed out, penalties should not have been imposed. The first appellate authority rejected the appeals of Revenue as well as the assessee. 5. Learned Counsel draws our attention to the facts of the case as also the records. It is his submission that appellant-assessee had discharged the service tax liability on the amounts paid by them to their associated company for Corporate Guarantee extended on behalf of appellant during the period 2009-10 and 2010-11. The classification of the said services is under different Heading and not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... discharged under the category of 'Consulting Engineering Service'. 7. We have considered the submissions made by both sides and perused the records. 7.1 First we take up the appeals filed by the assessee-appellant as well as the orders of both the lower authorities. 7.2 We find that during the course of audit, an objection was raised for non-discharge of service tax liability, appellant-assessee had accepted the merits of the objection that there was an error in not discharging tax though they were under bonafide impression that the amount paid by them for giving corporate bank guarantee will not fall under the service tax liability, they discharged the service tax liability and the interest thereof. We find that the law is now ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 15,37,327/- was in respect of reimbursable expenses paid by appellant-assessee for the facilities being extended for the visit of their foreign associates to India for work related activities. Appellant-assessee had discharged the service tax liability on the amount paid under the category of Consulting Engineering Services service and is not paid on reimbursable expenses. We agree with the findings of the lower authorities that the service tax liability on the amount paid as reimbursable to the professionals will not includable as gross value of services and not taxable under Rule 5(1) and also the Rule 7 of the Service Tax Valuation Rules which categorically rules out the reimbursable expenses. We find that the first appellate authority ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
