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TMI Blog2019 (7) TMI 500X X X X Extracts X X X X X X X X Extracts X X X X ..... y, which is deducted from the supplier/contractor's bill and on encashment of bank guarantee of defaulters/ suppliers. 3. The brief facts are that the appellant is a electricity distribution company, a Public Sector Undertaking, engaged in the transmission or distribution of utility covered under negative list of services under clauses (k) of section 66D of the Finance Act, 1994. They are registered with the service tax department for services viz. renting of immovable property service. They also received certain services and are also liable to pay service tax under Reverse Charge Mechanism. They were also liable to pay service tax on the amount, in respect of the services received for the man power supply services, legal services, rent-a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant was required to show cause by notice dated 30.03.2017, for extended period of 2014-2015 to 2015-2016, demanding an amount of Rs. 30,46,354/- including cess on such gross amount appeared in trial balance, under relevant head. The show cause notice was adjudicated on contest and proposed demand was confirmed along with equal amount of penalty under Section 78. Being aggrieved, the appellant appealed before the ld. Commissioner (Appeals), who was pleased to allow the appeal in part, holding that the service tax is not demandable on the amount of bank guarantee encashed, for non-return of the transformer, which is entrusted to the contractor/repairer. Accordingly, the demand was reduced to Rs. 4,61,215/- along with penalty. Being a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the contention of the Revenue is wholly mis-placed, as this amount does not pertain to any service as defined under Section 66F (e) of the Finance Act for any agreement/or obligation to tolerate an act or a situation, or to not do an act". 5. Further, the said amounts are often subject to refund, by approval of the competent authority in future. Accordingly, he prays for setting aside the demand and penalty, imposed by the ld. Commissioner (Appeals). 6. Ld. Authorised Representative for the Department/Respondent relies on the impugned orders and states that the amount deducted by way of penalty from the gross bills is definitely an amount qualifying towards services under Section 66 E(e) of the Finance Act, as the said amount deducted w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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