TMI Blog2017 (3) TMI 1413X X X X Extracts X X X X X X X X Extracts X X X X ..... epartment has been represented by Id. AR Shri Sanjay Jain. 4. The Id. Advocate on behalf of the memorandum of appeal, inter alia submits as under: (i) Service tax is wrongly confirmed on the amount realised for the services provided prior to 1.5.2006. (ii) Credit has wrongly been not allowed of ₹ 1,74,681/-. (iii) Amount incurred and charged as Pure Agent is not chargeable to tax. These expenses are incurred on behalf of the client; they are reimbursed by the client and these are substantiated by documentary evidence. In support, the following cases are relied upon: (a) CCE, Belgaum Vs. Pratik Agencies - 2008 (11) STR 117 (Tri.-Bang.) (b) Scott Wilson Kirkppatrick (I) P. Ltd. Vs. CST, Bangalore - 2007 (5) STR 118 (Tri.-Bangalore). (c) Malabar Management Services P. Ltd. Vs. CST, Chennai - 2008 (9) STR 483. (iv) Reimbursement of expenses charged on actual basis is not taxable under Rule 5(2) of Service Tax (Determination of Value Rules), 2006. (v) The extended period is not invocable. The appellant relies on the Apex Court's judgement in the case of M/s Kushal Fabricators Pvt Ltd. Vs. CCE - 2009 (238) ELT 21 (SC) . All the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ursable cost'. In the instant cases various expenses made by the appellant, was essential input services in performing the act of recovery agent, therefore, even if such expenses are subsequently reimbursed by the Banks, are includible in the taxable value. This is also the view of Hon'ble Tribunal in number of cases out of which some are quoted below (a) CCE Vs. Team S S - 2011 (930) STT 30 and (b) Harveen Co. Vs. CCE - 2011 (30) STT 111. . I further find that the appellant had made expenses towards Tractor seizing (Towing) charge and getting reimbursement of such expenses from the Bank. The investigation has brought on record that the appellant have charged service tax to banks on such amount. Annexure-V to the show cause notice are some invoices of the appellants which were retrieved from the seized computer, also shows that the service tax is also charged on the charged for out of pocket expenses. The appellant have disputed these invoices and its content. However, they have submitted that they have not charged service tax on reimbursed amount. The said argument of the appellant. In view of contrary evidence on record (Annex-X to the Show Cause Notice) c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fication at the level of original adjudicating authority. Wherever confirmation of service tax on certain expenses incurred on various items resulted in double taxation, the appellant would be entitled to claim the same back as Cenvat credit/refund. For this purpose, the matter is remanded back to the original adjudicating authority, who shall give the relief of Cenvat credit/refund on this after giving a personal hearing to the appellants and after necessary verification. 7.2 Extended period not invocable - The appellant's submission that there is no wilful suppression of facts or mis-statement with intent to evade payment of tax cannot be accepted as the facts on record indicate that the appellant did not disclose required information to the department. The appellant disregarded the summons issued to them and they tried to avoid joining investigation. Revenue makes the case only after seizure of documents and after retrieval of information from seized computer belonging to the appellant. Therefore, the Commissioner's conclusion that appellant made deliberate mis-declaration and suppression of fact cannot be questioned. 8. In the light of above discussions, the app ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... expenses, video recording, parking charges, etc. are the obligation of the appellant who is a mere recovery agent on behalf of the Banks. 15. The Hon'ble High Court of Delhi in the case of Intercontinental Consultants Technocrats Pvt. Ltd. Vs. UOI 2013 (29) STR 9 (Delhi) have considered the service tax (Determination of Value) Rules 2006 and have held that Rule 5 (1) of the said Rules as ultra vires in as much as the same travels beyond the scope of section 66 and 67 of the Finance Act 1994. The Hon'ble High Court observed that value of taxable services has to be in consonance with section 66 which levies tax only on taxable services and nothing else. Section 67 of the Finance Act clearly stipulates that the value of the taxable service is gross amount charged by service provider for such service . Accordingly, the Hon'ble High Court has held that the expenditure / cost such as air travel / hotel stay / transportation etc. incurred by service provider in course of providing taxable services cannot be considered to be the amount charged by service provider for such service provided by him. The said decision of the Hon'ble High Court of Delhi is fully ap ..... X X X X Extracts X X X X X X X X Extracts X X X X
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