TMI Blog2017 (4) TMI 284X X X X Extracts X X X X X X X X Extracts X X X X ..... his Tribunal Seva Automotive Pvt. Ltd. [2013 (7) TMI 265 - CESTAT MUMBAI] wherein this Tribunal held that For authorized service stations, the cost of the spare parts and cost of handling of spare parts are not to be included in the value of the services rendered, thus they will not form part of the services rendered - as demand not confirmed, penalty also set aside - appeal allowed - decided in f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant to demand of service tax on handling charges. The matter was adjudicated. The adjudicating authority confirmed the demand of service tax on handling charges along with interest and imposed penalty under Section 78 of the Finance Act, 1994. The Revenue filed the appeal against the said order on the ground that the adjudicating authority has not imposed penalty under Section 76 of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... never challenged before the ld. Commissioner (A), therefore, the same was not the subject matter for the Ld. Commissioner (A) to consider the same. Moreover, while filing the stay application by the appellant, it was considered by this Tribunal as they have paid duty of service tax involved in the matter but on account of the penalty on the appellant were asked to pay ₹ 10,000/- for conside ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as held that penalty under Section 76 78 of the Finance Act, 1994 is imposable. 7. Heard the parties and considered the submissions. 8. The question before me is that on merits the demand is not sustainable, in that circumstances, the penalty can be imposed on the appellant or not? 9. Admittedly, when the demand is not sustainable against the appellant, no penalty can be imposed on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r services of automobiles. If that be so, the cost of handling of such spare parts incurred by the respondent would also not form part of the taxable value of the service rendered. Therefore, we do not find any infirmity in the reasoning adopted by the lower appellate authority. Accordingly, we dismiss the appeal filed by the Revenue as devoid of merits. 11. Therefore penalties are not imposab ..... X X X X Extracts X X X X X X X X Extracts X X X X
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