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. Govan Travels Versus CCE, Delhi

2017 (10) TMI 506 - CESTAT NEW DELHI

Business Auxiliary Services - appellants are rendering services of air travel agent to their customers and are registered with service tax department and utilized computer reservation software provided by Galileo for booking of air tickets for their customers - Held that: - there is a special relationship between the appellant and M/s. Galileo whose CRS system the appellant is using. The incentive which has been called by the Department as commission is the consideration for giving certain kind .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

r said services will be chargeable to service tax under ‘Business Auxiliary Services’. - The Tribunal in the case of D. Pauls Consumer Benefit Consumer Benefit Ltd. Vs. CCE New Delhi [2017 (3) TMI 1019 - CESTAT NEW DELHI] has held that such services as provided by the present assessee / appellant is covered by the category of ‘Business Auxiliary Services’ as defined under section 65 of the Finance Act 1994. - Penalty u/s 78 - Held that: - In the present case, the demand confirmed is of & .....

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 Present Shri Amresh Jain, DR for the respondent ORDER Per: Ashok K. Arya 1. M/s. Govan Travels (proprietor M/s. Dalmia Bharat Sugar and Industries Ltd.) is in appeal vide Order-in-Appeal No.98/2011 dated 31.08.2012 whereunder the order in original no.16/11 dated 03.05.2011 confirming the demand of service tax of ₹ 2,59,195/- along with interest and penalty of ₹ 3 lakhs imposed has been sustained. 2. The brief facts are that:- i) The appellants are rendering services of a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

tem. iv) The department s stand is that the incentive (Commission) received from Galileo India Pvt. Ltd. (Galileo) by the appellant assessee is in connection with the services provided by Galileo and therefore, the incentive received will attract the service tax under the category of business auxiliary services in terms of Section 65 (105) (zzb) of Finance Act 1994 (w.e.f. 01.07.2003). The department therefore, issued show cause notices (SCNs) dated 05.03.2009, 13.04.2010 and 18.04.2011 thus dem .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

leadings of the Ld. Advocate of the appellant are that: i) They are not doing any promotional activity or marketing activity for M/s. Galileo, whose CRS was also known as GDS - Global Distribution Systems, which they are using. ii) The Ld. Advocate for the appellant / assessee submitted that GDS or CRS is a network applied by a company that enables automated transaction between the travel services namely, transport. iii) M/s. Galileo has provided free of cost computer software and internet conne .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ter having carefully considered the facts of the case and submissions of both the sides including from the document namely Galileo by Travelport; Offer to M/s. Dalmia Cement Bharat Ltd. (who is the group to which the appellant belongs to) (Offer no. ITQPL / BOM / 022-755) it appears that M/s. Dalmia Cement (Bharat) Ltd. and InterGlobe Technology Quotient Private Ltd. (ITQPL) join hands in marketing and promotion of Galileo India in exchange for a support fee. These wordings - marketing and promo .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nt it is specifically mentioned at its para 5 that M/s. Dalmia Cement Bharat Ltd. accepts this offer, along with all the conditions mentioned. 7. Further, from the facts, it appears that there is a special relationship between the appellant and M/s. Galileo whose CRS system the appellant is using. The incentive which has been called by the Department as commission is the consideration for giving certain kind of marketing and promotional support to the software product (CRS / GDS) pertaining to G .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

; or (v) production or processing of goods for, or on behalf of the client; or (vi) provision of service on behalf of the client; or (vii) a service incidental or auxiliary to any activity specified in sub-clauses (i) to (vi), such as billing, issue or collection or recovery of cheques, payments, maintenance of accounts and remittance, inventory management, evaluation or development of prospective customer or vendor, public relation services, management or supervision, and includes services as a .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d be covered under the definition of Business Auxiliary Services and the consideration received for said services will be chargeable to service tax under Business Auxiliary Services . The Tribunal in the case of D. Pauls Consumer Benefit Consumer Benefit Ltd. Vs. CCE New Delhi vide Final order no.50861/2017 has held that such services as provided by the present assessee / appellant is covered by the category of Business Auxiliary Services as defined under section 65 of the Finance Act 1994. In 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

s. The assessee-Appellants are not promoting the business of the said GDS/CRS companies by booking segments using the said product. At the strength of the written submission, he also submits that the amount received from GDS/CRS cannot be treated as deemed commission. So, the amount received is not taxable as no service has been provided. This is merely an incentive. The incentive received for usage of GDS/CRS does not attract the Service Tax. There is no promotion or marketing of business of GD .....

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 learned DR for the Department, relied upon the impugned order and submits that the commission received for GDS/CRS usage is fully covered under the heading Business Auxiliary Services . Hence, the demand of Service Tax was rightly confirmed by the lower authorities on this issue. 5. After hearing the rival submissions and on perusal of record, it appears that the assessee-Appellants are travel agent and providing the tickets for air as well as railways. They also act as the Rail Travel Agent .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the world. They are by using these GDS/CRS for booking tickets, receiving incentives from the said companies for every segment booked by them. Hence, the service provided by the assessee-Appellants has rightly been covered under the heading Business Auxiliary Service as defined under Section 65(19) of the Finance Act, 1994. Thus, we are of the view that the assessee-Appellants being providing Tour Operator s Service , the commission received by them is for Business Auxiliary Service under Sectio .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

tes that certain issues were clarified and there in paragraph 15.1.2, it was mentioned that: 15.1.2 It is clarified that incentives received by the Air Travel Agents (ATAs) from the Companies providing Computer Reservation System (CCRS) are for using the software and platform provided by the CCRS like Galileo, Amadeus, etc. The CCRS are providing these incentives either for achieving the targeted booking of air tickets or for loyalty for booking of air tickets using their software system. Thus, .....

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
  ↓     bird's eye view     ↓  


|| 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