TMI Blog2017 (9) TMI 1004X X X X Extracts X X X X X X X X Extracts X X X X ..... xist in the present case - Perusal of various work orders indicate that no such arrangement exist in the present case - The appellants are liable to service tax on the gross amount received. They cannot restrict their tax liability to only agency commission in view of the details given in the work orders examined by us. Time limitation - Held that: - A perusal of various work orders clearly shows that the appellants deliberately chose to discharge service tax only on the agency commission or fee which is a small portion of the gross amount. The claim for exclusion of other consideration on the ground that they are reimbursable expenditure is found not tenable. The appellant’s action of not paying service tax on the gross value and cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Their service should have been taxed under business exhibition service/BSS/BAS, based on the nature of contract entered into by them. The Original Authority confirmed service tax liability of ₹ 1,22,57,631/- on the appellant and imposed equal amount of penalty under Section 78 of the Finance Act, 1994. 2. The learned Counsel appearing on behalf of the appellant submitted that irrespective of classification of service rendered by them, the tax liability cannot include the consideration received by them towards reimbursable expenditure incurred for the clients. During the course of provision of various types of services the appellants procured and supplied goods and materials to the clients in terms of contract. As per the decision o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ecords. The main thrust of the appellant is regarding valuation of taxable service rendered by them. They have been paying service tax only on agency fee or commission collected from the client. They have entered into various types of contracts with clients like Hindustan Lever Ltd., Eicher Tractors Ltd., Escorts Ltd., Godrej Sara Lee Ltd., Maruti Suzuki Ltd. and Emami Ltd. We have perused these contracts. We note that the nature of services are such the appellants are managing participation of clients in certain mela, fairs, promotional activities of merchandise, managing events with a aim to propogate the products of the clients etc. We note that the Original Authority examined, in detail, the scope of work orders before arriving at h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... organizing an event to attract the ST under the taxable category of event management service. I find that any services which constitute either planning or promotion or organizing or presentation would be taxable under this category. It is clear from the activities undertaken by M/s IC that they are organizing/presenting the business event and their activities are not restricted to just supply certain equipments or services to an event organizer. These events were also not organized by their clients. Their clients were only the sponsors of these events and the same was organized and executed by M/s IC. Thus, it is clear that the activities undertaken by M/s IC are covered under event management service as defined in clause (40) of Section 6 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... indicate that no such arrangement exist in the present case. For example in the work order dated 07/02/2006 of Emami, the payments are indicated under different headings like complete stall fabrication, manpower, printing glow sign, agency fee, service tax and finally total. We note this is nothing, but the break up of consideration and cannot be taken as agreement to reimburse any procurement of items or services for or on behalf of client on actual basis. Such break ups are as lump-sum amounts mainly to arrive at the overall gross consideration for the work order. We find no scope to consider any one of these components as reimbursable expenditure. The appellants are liable to service tax on the gross amount received. They cannot restrict ..... X X X X Extracts X X X X X X X X Extracts X X X X
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