Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

M/s. Sarovar Hotels Pvt. Ltd. Versus Commissioner of Service Tax, Mumbai

Management Consultancy Services - It was alleged that the appellants have received Franchisee Service from PG and service tax on the same was payable under reverse charge as import of services in terms of Section 66A of the Finance Act, 1994 - Held that: - the so called service of Franchise was provided by PG, USA to the appellant for which the appellant has paid the fees in convertible foreign exchange, this amount was paid out of the total receipt by the appellant from the ultimate service rec .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ice tax payable in respect of Franchise service, therefore the entire issue is revenue neutral - this is a clear case of revenue neutrality. - The demand of service tax in the present case amounts to double taxation on the part of the same service charges - appeal allowed - decided in favor of appellant. - Appeal No. ST/701/12 - Dated:- 31-8-2017 - Shri Ramesh Nair, Member ( Judicial ) And Shri Raju, Member ( Technical ) Shri Vinod Awtani, C.A. for the appellant Shri M.K. Sarangi, Add, Commr .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

reement grants exclusive rights to the appellants to develop hotels in India which includes the rights to use the names Park Inn , Park Inn International , Park Plaza , and Park Plaza International as well as to use the system of hotel management. As per the agreement, the appellants are required to pay the amount of Commitment Fees, Monthly Royalty Fees, Reservation Fees and Advertising Fees. In view of the territorial license granted, the appellant enters into hotel management agreement with I .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

bserved that the appellant had made payments in foreign currency to PG under the said agreement which was indicated in the audited balance sheet and service tax was not paid on the same. It was alleged that the appellants have received Franchisee Service from PG and service tax on the same was payable under reverse charge as import of services in terms of Section 66A of the Finance Act, 1994. Accordingly show cause notice dt. 21.10.2010 was issued demanding service tax amounting to ₹ 1,29, .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

mits that the demand is not sustainable on the ground of revenue neutrality, as the service tax paid/to be paid on the service of so called franchisee service is admissible as cenvat credit to the appellant. He submits that the service of PG, USA is clearly subsumed in the overall output service provided by the appellant to their clients i.e. various hotels in India, therefore Cenvat Credit is clearly admissible. The learned Counsel further submits that the appellant during the relevant period i .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

od reduced to this extent, accordingly the entire case is revenue neutral. In support he placed reliance on the following judgments: (i) Jet Airways (I) Ltd. Vs. Commissioner of Service Tax, Mumbai 2016 (44) STR 465 (Tri.-Mumbai) (ii) United Phosphorous Ltd. Vs. Commissioner of Service Tax, Mumbai 2016-TIOL-1572-CESTAT-MUM (iii) Rochem Separation Systems (India) P. Ltd. Vs. Commr. of S.T., Mumbai-I 2015 (39) STR 112 (Tri.-Mumbai) (iv) Commissioner of C.Ex., Pune Vs. Coca-Cola India Pvt. Ltd. 200 .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

he appellant. Therefore the part amount of which remitted to the foreign hotel brand owner will amount to double taxation. For this reason also demand is not sustainable as held in the case of Dinesh M. Kotian Vs. Commissioner of Central Excise & S.T.-I, Mumbai 2016 (42) STR 772 (Tri.-Mumbai). He further submits that demand on the amount of advertisement fees is not an amount under the contract with PG and moreover such amount is not remitted, therefore the same is not liable to service tax. .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

not recovered from the hotels on which service tax have been discharged therefore this demand is patently incorrect. Without prejudice, he further submits that as regards this advertisement expenses the service tax cannot be demanded for one more reason that the said amount was not received separately by the appellant and the service tax at the relevant time was chargeable only on the actual receipt of the service charges. For this reason also the service tax on the advertisement fees cannot be .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

dt. 15.12.2005 from the Preventive Section of the Commissioner of Central Excise, Mumbai-I enquiring about the agreement entered into with M/s. Park Global Holdings Inc. the appellant had replied to the said letter vide letter dt.29.12.2005. Thus, the department was totally aware about the transactions and the payment made by the appellants to PG under the said agreement therefore there is no suppression of fact on the part of the appellant. The show cause notice has apparently erred to allege t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

(i) Reliance Industries Ltd. Vs. Commr. of C. Ex., & S.T., LTU, Mumbai 2016 (44) STR 82 (Tri.-Mumbai) (ii) Nirlon Ltd. Vs. Commissioner of Central Excise, Mumbai 2015 (320) E.L.T. 22 (S.C.) (iii) Jay Yuhshin Ltd. Vs. Commissioner of Central Excise, New Delhi 2000 (119) E.L.T. 718 (Tribunal-LB) As regard penalty he submits that since there is no malafide intention on the part of the appellant as submitted above. Penalties under Section 76, 78 cannot be imposed. He placed reliance on the follo .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

bal Holdings Inc,. PG does not fall under the definition of Franchise services in terms of Section 65(47). He submits that the Foreign Service provider has not given the representational right to the appellant. Nothing in the agreement suggest that the appellants can represent M/s. Park Global Holdings Inc. The PG have only permitted the appellant to use their brand name along with system, this does not empower the appellant to represent M/s. PG and therefore there is no grant of representationa .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nted representational right by the PG for providing services to Indian Hotels. Therefore the services clearly falls under franchise service, hence it is taxable. 4. We have carefully considered the submissions made by both the sides. On hearing both sides we find that the appeal can be disposed of on the point of revenue neutrality. In this regard, we observed that the so called service of Franchise was provided by PG, USA to the appellant for which the appellant has paid the fees in convertible .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     Latest Happenings     ↓  

Highlight: The interest u/s 234B of the Act cannot go beyond the stage of S.245D(I) before the Settlement Commission - HC

Highlight: Galvanized iron pipe is a different commercial commodity than a iron pipe, therefore the activity of galvanization in our considered opinion amounts to manufacture - Deduction u/s 80-IB allowed - HC

Highlight: Penalty u/s 271C - non deduction of TDS on interest paid to sister concerns in terms of Section 194A - Levy of penalty confirmed - HC

Highlight: Disallowance of interest - reference to section 179 - The legislature has also recognised, that the doctrine of lifting of veil in the matter of tax dues is to be applied to prevent fraud etc. and not where the company has suffered despite its normal bona fide function. - HC

News: RBI Reference Rate for US $

Notification: Amendment in Notification No. S.O. 3118(E), dated the 3rd October, 2016

Highlight: Discount on ESOP to be allowed as business expenditure u/s 37(1), during the years of vesting on the basis of percentage of vesting during such period, subject to upward or downward adjustment at the time of exercise of option.

Notification: Central Government appoints the 20th September, 2017 as the date on which proviso to clause (87) of section 2 of the Companies Act 2013, shall come into force

Notification: Companies (Restriction on number of layers) Rules, 2017

Highlight: Penalty u/s 271(1)(c) - additional income disclosure - surrender of income post survey u/s 133A - he disclosure made by the assessee is voluntary in nature, in the revised return - no penalty

Highlight: Reopening of assessment - notice u/s 148 issued on the directions of JCIT / CIT - a perusal of reasons for initiating reassessment proceedings clearly show that they are against the sprit of provisions u/s 147

Notification: All Industry Rates of Duty Drawback Schedule

Highlight: MAT - Adjustment to book profit - computation u/clause (f) of Explanation-1 to section 115JB(2) is to be made without resorting to the computation as contemplated u/s 14A r.w.Rule 8D of I.T. Rules.

Notification: The Customs and Central Excise Duties Drawback Rules, 2017

Highlight: Addition on account of alleged suppression of service value received - the addition made simply believing the Form 26AS will be an arbitrary exercise of power which cannot be sustained

Notification: Exempts intra state supply of heavy water and nuclear fuels from DAE to NPCIL

Notification: Seeks to amend notification No. 12/2017-UTT(R) to exempt right to admission to the events organised under FIFA U-17 World Cup 2017

Notification: Seeks to amend notification No. 11/2017- UTT(R) to reduce CGST rate on specified supplies of Works Contract Services

Highlight: Liability to pay duty on import of software - Though no authorization was given by the appellant to DHL, it is an undisputed position that the software has, in fact, been ordered by the appellant and have been delivered to them by DHL - the appellant is to be considered as the importer

Notification: Exempts inter-state supply of heavy water and nuclear fuels from DAE to NPCIL

Notification: Seeks to amend notification No. 09/2017-IT(R) to exempt right to admission to the events organised under FIFA U-17 World Cup 2017

Notification: Seeks to amend notification No. 08/2017-IT(R) to reduce CGST rate on specified supplies of Works Contract Services

Notification: Exempts intra state supply of heavy water and nuclear fuels from DAE to NPCIL

Notification: Seeks to amend notification No. 12/2017-CT(R) to exempt right to admission to the events organised under FIFA U-17 World Cup 2017

Notification: Seeks to amend notification No. 11/2017-CT(R) to reduce CGST rate on specified supplies of Works Contract Services.

News: Tax on fuel more important for a dry state like Gujarat

Highlight: For an ayurvedic medicine to be classified under Chapter 30 has to pass the test whether it is for cure of any disease. If the same is only meant for care, then such product would not fall under medicament.

Highlight: Demand of interest - the period of limitation that applies to a claim for the principal amount should also apply to the claim of interest thereon.

Highlight: Government issues new notifications under CGST, IGST and UTGST to grant fresh exemptions in respect of certain supplies.

Circular: Extension of time limit for submitting the declaration in FORM GST TRAN-1 under rule 117 of the Central Goods and Services Tax Rules, 2017

Forum: 3B mistake

Forum: Excise duty credit on finished stock at additional place of business.

Forum: Input tax credit

Forum: Cess paid instead of SGST

Forum: Manpower Service provider

Forum: Construction of single unit bungalow

Forum: Duty Drawback & Input Credit - under GST

Article: SIMPLIFIED E-WAY BILL UNDER GST

Article: SERVICES UNDER REVERSE CHARGE UNDER GST REGIME

Highlight: Rate of exchange of conversion of the foreign currency with effect from 22th September, 2017 - Notification

Highlight: Companies (Acceptance of Deposits) Second Amendment Rules, 2017 - Notification

Highlight: Implementing Electronic Sealing for containers by exporters under self-sealing procedure prescribed by Circular 26/2017-Cus dated 1st July, 2017 and Circular 36/2017 dated 28 th August, 2017. reg. - Circular

Highlight: Amendment to Paragraph 2.72 (b) of the Handbook of Procedures of the Foreign Trade Policy (FTP) 2015-20 - Public Notice

Notification: Amendment in Appendix 3 (SCOMET items) to Schedule- 2 of ITC (HS) Classification of Export and Import Items 2012

Circular: Amendment to Paragraph 2.72 (b) of the Handbook of Procedures of the Foreign Trade Policy (FTP) 2015-20

Notification: Companies (Acceptance of Deposits) Second Amendment Rules, 2017

Notification: Rate of exchange of conversion of the foreign currency with effect from 22th September, 2017

News: Exchange Rate of Foreign Currency Relating To Imported and Export Goods Notified

Circular: Promote the officers of the Indian Revenue Service (Customs and Central Excise) to the grade of Principal commissioner of customs, GST & CX

Circular: Allocate the charges amongst the Members of the Central Board of Excise and Customs



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version