TMI Blog2023 (9) TMI 236X X X X Extracts X X X X X X X X Extracts X X X X ..... vice Tax. Hence, the same is required to be set aside, which we hereby do. Demand on reimbursable expenses - HELD THAT:- The issue as to whether demand of Service Tax can be made on reimbursable expenditure has been settled by the Hon ble Apex Court in the case of UNION OF INDIA AND ANR. VERSUS M/S. INTERCONTINENTAL CONSULTANTS AND TECHNOCRATS PVT. LTD. [ 2018 (3) TMI 357 - SUPREME COURT] . Following the same, the demand cannot sustain and requires to be set aside. The demand of interest on the advance (of Rs.85 crores) received by the appellant and returned thereafter, as confirmed in paragraph 14.1 of the impugned order, cannot sustain and requires to be set aside - the demand of Service Tax on the reimbursable expenses, as discus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... their taxable value and the appellant had not discharged Service Tax on such charges contending that these are reimbursable expenses. That they had availed ineligible credit on architectural fees, construction charges incurred for interior work of guest house, Sodexo Pass, insurance, air travel, etc., which according to the Department was wrongly availed; that the appellant had to pay interest on the irregularly availed CENVAT Credit which was also utilized by them. Further, that the appellant had not discharged Service Tax on the expenses incurred by them during the import of professional and technical consultancy service under reverse charge mechanism 2. Show Cause Notice dated 24.10.2011 was issued proposing to demand Service Tax alo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on Architectural Fees, Construction Charges incurred for the interior work of the assessee s guest house and on Sodexo Pass, Insurance, Air Travel, Hotel Accommodation, Catering and Entertainment Services received by the assessee? (vi) Whether interest is payable on reversal of irregular cenvat credit availed and utilised by the assessee? (vii) Whether service tax is payable on the expenses incurred by the assessee during the import of professional and technical consultancy service under reverse charge mechanism? (viii) Whether extended period of limitation under proviso to Section 73(1) of the Finance Act, 1994 could be invoked to demand service tax? (ix) Whether penal action under Section 75, 76, 77 and 78 of the Fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble, the interest ought not to have been confirmed by the adjudicating authority. 4.6.1 He would refer to paragraph 17.0 of the impugned order to argue the issue with regard to reimbursable expenses. It is submitted that the appellant had collected electricity charges, water charges, sewerage charges and infrastructure charges from the allottees of the project; that these charges have been deposited with the concerned authorities. The original authority has confirmed the demand of Service Tax observing that the appellant has collected mark-up on these charges. He would contend that in fact, the appellant has not collected any mark-up and they collected only the actual charges; the documents in respect of collection from the allottees wou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to M/s. Himadri who has relinquished their right on the proposed constructed area. Even if the assessee had paid service tax on such advance amount of Rs.85 crores on the day of receipt the same can be taken back as credit on refunding the advance amount in terms of Rule 6(3) of the Service Tax Rules, 1994 as the assessee had not carried out construction activity and not provided any service and sold the land subsequently to M/s. Sugam Vanjiya Holdings Private Limited vide sale deed dated 18.09.2013. Therefore the tax liability has been nullified. Further, the compensation amount of Rs.103.50 crores paid by the assessee for not carrying out the project within the reasonable time is against the cancellation of arrangement and therefore has ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, however, it is not mentioned as to whether from which allottees the appellant has collected such higher charges. The Ld. Counsel for the appellant has submitted in this regard that they have only collected the actual amount. 8.2 The issue as to whether demand of Service Tax can be made on reimbursable expenditure has been settled by the Hon ble Apex Court in the case of Union of India v. Intercontinental Consultants and Technocrats Pvt. Ltd. [2018 (10) G.S.T.L. 401 (S.C.)]. Following the same, we are of the considered opinion that the demand cannot sustain and requires to be set aside, which we hereby do. 9. In view of our above discussions, we hold that: - (i) The demand of interest on the advance (of Rs.85 crores) received by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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