TMI Blog2017 (8) TMI 221X X X X Extracts X X X X X X X X Extracts X X X X ..... The Commissioner of Central Excise Versus M/s. Bharat Cell [2015 (10) TMI 1111 - MADRAS HIGH COURT], where Decision made in the case of G.R. Movers vs. Commissioner of Central Excise, Lucknow [2013 (6) TMI 339 - CESTAT NEW DELHI] followed and it was held that there is no business auxiliary service and the demand is set aside. Amount reflected in the credit notes issued by M/s. VCL to appellant - demand - Held that: - these are nothing but reimbursable expenses - issue stands covered by the decision in the case of Commissioner of Service Tax Versus M/s. Sangamitra Services Agency [2013 (7) TMI 862 - MADRAS HIGH COURT], where it was held that if a receipt is for reimbursing the expenditure incurred for the purpose, the mere act of reimburs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scount on the MRP. The appellants after outright purchase, sell their recharge vouchers, electronic coupons and earn small margin. That on the entire MRP, service tax has been remitted to the department by M/s. VCL. The department was of the opinion that the income earned on resale of recharge vouchers and electronic coupons, starter packs is a discount or commission provided by M/s. VCL and therefore issued show cause notice demanding service tax on the margin earned by the appellant on such resale. It was alleged that the appellants are providing business auxiliary service as per the contract between M/s.VCL and the appellant. After due process of law, the original authority confirmed the demand along with interest and also imposed penalt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner Vs. Karakattu Communications 2016 (45) STR J209 (Ker.). 3. With regard to Appeal No. ST/132/2011 and ST/41103/2014, the learned counsel pointed out that demand has been raised on the credit notes issued by M/s. VCL to appellants. That these credit notes are alleged to be discounts received by appellant on the sale of starter pack vouchers etc. He explained that the credit notes were only reimbursement of expenses like Customer Activation Form (CAF), pick up charges on actuals, payment of salary to employees, starter pack price difference, RTGS charges incurred by appellant, sales scheme expenses etc. That on the value of the alleged credit note M/s.VCL has already paid service tax. That such reimbursable expenses cannot in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... demand is also made on the margin earned by the appellant for outright purchase and sale of pepsico products. It is not disputed that the appellants in these appeals have discharged VAT on the products sold by them. Therefore, the department cannot demand service tax basing upon the distribution agreement entered into with M/s. Pepsico Holdings (India) Pvt. Ltd. The judgment relied upon by the learned counsel for the appellant in the case of BPCL (supra) is squarely applicable to the said issue. 7. From the foregoing discussions, we find that the demand is unsustainable. The impugned orders are set aside and the appeals are allowed with consequential relief if any. ( Operative portion of the order was pronounced in open court ) - ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
