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TMI Blog2022 (6) TMI 44X X X X Extracts X X X X X X X X Extracts X X X X ..... rtered accountant services". The dispute in the present appeal is regarding the non-payment of service tax on the amount representing reimbursement of expenses like conveyance, travelling and mobile expenses. 3. A show cause notice dated July 02, 2008 was issued to the appellant mentioning therein: "And whereas, from the perusal of statement of Sri Rajiv Bajpai on behalf of RMA & Associates and the reply of RMA dated May 17, 2008, it appears that RMA have not paid service tax on the expenditure got reimbursed by them in the course of performance of their professional services and it appears that value of service is to be added in the gross value of services rendered by them in terms of section 67 of Finance Act, 1994. It therefore, appea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reimbursement & short paid amounts, which is thus rightly recoverable. Seen in the spirit of circular quoted by the noticee the reimbursement claimed here has no direct nexus with the services and these are not case specific. These are general charges for which proportion of charges has no clear co-relation. The noticee has nowhere established that the amount of expenses ever if incurred on behalf of customer are verifiable. From the documents there appears no direct co-relation between the amounts re-imbursed and invoices raised. No supporting documents/ vouchers/ accounts have been produced." 5. The submissions made by the appellant before the Commissioner (Appeals) did not find favour of the Commissioner (Appeals) and the appeal was ult ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appeal is, accordingly, being decided after hearing Dr. Radhe Tallo, learned authorized representative for the Department. 8. The issue, in respect of reimbursable expenses has been considered and decided by the Supreme Court in Union of India vs. Intercontinental Consultant and technocrats [2018(10)G.S.T.L. 401(S.C.) ]. The relevant observations are as follows: "21. Undoubtedly, Rule 5 of the Rules, 2006 brings within its sweep the expenses which are incurred while rendering the service and are reimbursed, that is, for which the service receiver has made the payments to the assesses. As per these Rules, these reimbursable expenses also form part of 'gross amount charges'. Therefore, the core issue is as to whether Section 67 of the A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 'taxable service'. That according to us is the plain meaning which is to be attached to Section 67 (unamended, i.e., prior to May 1, 2006) or after its amendment, with effect from, May 1, 2006. Once this interpretation is to be given to Section 67, it hardly needs to be emphasised that Rule 5 of the Rules went much beyond the mandate of Section 67. We, therefore, find that High Court was right in interpreting Section 66 and 67 to say that in the valuation of taxable service, the value of taxable service shall be the gross amount charged by the service provider 'for such service' and the valuation of tax service cannot be anything more or less than the consideration paid as quid pro qua for rendering such a service. 25. This position did ..... X X X X Extracts X X X X X X X X Extracts X X X X
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