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TMI Blog2020 (1) TMI 1232X X X X Extracts X X X X X X X X Extracts X X X X ..... appellant had entered into the agreement dated 01.04.2007 with M/s. Hindustan Unilever Ltd. (HUL) for warehousing the goods on their behalf. The case of the department is that though the appellant had discharged the service tax liability in respect of commission/remuneration received from M/s. HUL and reflected such particulars in the ST-3 returns, but did not pay the service tax on reimbursement amount received from such principal on certain expenditure incurred on account of freight, rent, handling, halting charges etc. The department was of the view that under Rule 5 of the Service Tax (Determination of the Value) Rules, 2006, the appellant was required to discharge the service tax liability in respect of reimbursement amount received f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 5) G.S.T.L. 107 (Tri.- Chennai), E.V. Mathai & Co. Vs. Commissioner of Central Excise, Cochin - 2006 (3) STR 116 (Tri.-Bang.) and the letter issued from file F.No.341/18/2004-TRU (Pt.), dated 17.12.2004 by the CBEC, to submit that value of taxable service as per Section 67 ibid should only be considered with the gross amount charged for providing the taxable service and re-imbursement amount received as per actual cannot be included in the gross value for payment of service tax. 3. On the other hand, the Ld. AR appearing for Revenue reiterated the findings recorded in the impugned order. 4. Heard both sides and examined the case records. 5. In the case in hand, the appellant had entered into the agreement dated 01.04.2007 with the princi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able service as per the provisions of Rule 5 (1) ibid. Valuation provisions for the purpose of charging service tax are contained in Section 67 ibid. The said statutory provisions mandate that in case, where the provision of service is for a consideration in money, then the gross amount charged for providing such service shall be considered as taxable service for the purpose of payment of service tax. It is an undisputed fact on record that over and above the amount agreed upon towards service charges, the appellant did not obtain any monitory benefit for providing any taxable service and that the amount of reimbursement towards the expenses received by the appellant towards different charges was not in connection with provision of the serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e and nothing less than the consideration paid as quid pro quo for the service can be brought to charge. Sub-section (4) of Section 67 which enables the determination of the value of the taxable service "in such manner as may be prescribed" is expressly made subject to the provisions of sub-section (1). The thread which runs through Sections 66, 67 and Section 94, which empowers the Central Government to make rules for carrying out the provisions of Chapter V of the Act is manifest, in the sense that only the service actually provided by the service provider can be valued and assessed to service tax. We are, therefore, undoubtedly of the opinion that Rule 5 (1) of the Rules runs counter and is repugnant to Sections 66 and 67 of the Act and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Service Tax Rules, 1994. In this context, the CBEC has clarified that if service tax due on transportation of a consignment has been paid or is payable by a person liable to pay service tax (recipient of service), then service tax should not be charged for the same amount from any other person, to avoid double taxation. The views expressed by the Board are in conformity with the statutory provisions and hence, amount reimbursed by M/s. HUL to the appellant as per the contractual norms should not be included in the gross value for determination of the service tax liability. 9. In view of above discussions, we do not find any merits in the impugned order, in so far as it has confirmed the adjudged demands on the appellant. Accordingly, by s ..... X X X X Extracts X X X X X X X X Extracts X X X X
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