TMI Blog2023 (10) TMI 813X X X X Extracts X X X X X X X X Extracts X X X X ..... t and the said receipts are not chargeable to Service Tax. Repossession charges received by the Appellant credited under 'other charges' in the profit loss account - HELD THAT:- Demand not tenable as they are received from the owners of the vehicle, whose vehicles are repossessed by the financiers and for safekeeping are entrusted to the Appellant. For such service or parking, the Appellant received an amount from the vehicle owners which is not taxable under BAS. Further, these receipts are on principle to principle basis and on that score also are not liable to Service Tax. Job work charges - HELD THAT:- The learned Commissioner has himself held that the same is not taxable under BAS but under Authorized Service Station charge, which was not the case made out in SCN and as such the demand of service tax on these charges is not tenable. Further, the receipt for service of commercial vehicle is not taxable under the category of 'Authorized Service Station'. Freight received from customers/Tata Motors - HELD THAT:- The essential ingredient of GTA, (that issuance of consignment notes was not done by the Appellant) thus, the same cannot be made liable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ; (iv) Penalty should not be imposed upon them under Section 78 of the Finance Act, 1994, for suppression of value of taxable service; (v) Penalty should not be imposed upon them under Section 76 of the Finance Act, 1994, for non payment of Service Tax due thereon; (vi) Penalty should not be imposed upon them under Section 77 of the Finance Act, 1994, for contravention of various provisions of the said Act. Reply to show cause notice was filed. However, adjudicating authority vide the impugned order observed as under:- ORDER i. I order that the entire amount of Rs.18,09,07,551.00 (Rupees Eighteen Crore Nine Lac Seven Thousand Five Hundred and Fifty One) received by M/s Ashoka Auto Sales Ltd., Nunhai, Agra during the Financial Year 2011-12 as detailed in Table-I, II, III IV of the demand-cum-show cause notice for rendering the services mentioned in respective table should be treated as taxable value as per Section 67 of the Finance Act, 1994; ii. I confirm the demand of Service Tax amounting to Rs.1,75,10,117/- [Service Tax Rs.1.70,69,897.00+ Edu Cess Rs.3,41,117/- + H EC Rs.1,70,557/-] (Rupees One Crore Seventy Five Lakhs Ten Thousand One Hundre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ature of trade discounts wholly attributable to the trading activity and as such, demand for this activity is not taxable under the Service Tax provisions. 4. The second issue is regarding commission received from banks and financial institutions. The learned Counsel explains that they have not provided any service to the said banks/financial institutions. They have only provided permission or undefined table space in their premises to the banks and financial institutions so as to facilitate the availability of loan facility to the buyers of the vehicles. Since only such facility is provided, there is no element of Business Auxiliary Service as neither they are marketing any services of client nor they are personally involved in assisting the banks/financial institutions. The banks and/or financial institutions gave some incentive or commission to the Appellant on the business generated by their own efforts, which is by using the premises of the Appellant. At best, it may be in the nature of Business Support Service but the same cannot be Business Auxiliary Service. 5. So far the issue of receipts under hire purchase commission/other charges is concerned, it is explained that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lant had received income from the Job work during the period and it was also observed that they had received income from the freight under the two heads- 'freight received' and Freight received on transport vehicle (logistics)'. On being asked by the Audit Officers regarding supporting documents and/or clarification against these income received from Job work and Freight received on transport vehicle - logistics, the Appellant did not provide these documents to the Audit Officers on the spot nor at a later stage during investigation. Accordingly, it appeared that Freight received is in the nature of receipt as a Goods Transport Agency as defined under Section 65(50b) of the Act. 8. Further, it appeared that the job charges as found from the profit and loss accounts was also taxable under BAS, as BAS provides for any service in relation to promoting, marketing or sale of the goods for or on behalf of the client and thus, nature of job work under taken by the party was also covered. Learned Counsel explained that so far job work charges are concerned, it is the same service charges received by the Appellant for provision of services as an Authorized Service Station and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ciple basis'. Both are promoting each other s business. The Appellant is interested in sale of the vehicle whereas the financial institutions or banks are interested in disbursement of loan for earning interest. Therefore, no particular activity done by the Appellant is identified which has the element of promoting the business of such banks and institutions save and except permission to use their premises or table space. 14. We hold that incentive or discount or commission received from the banks and institutions does not lead to the conclusion that the Appellant provided service to them. At the most, it may be in the nature of business support service which is not the case made out in the SCN. Accordingly, we hold that Service Tax is not payable on commission received from bank/financial institution. 15. So far the hire purchase commission is concerned, we hold that such charges are being received from the buyers of vehicles for assisting in registration/insurance etc. of the vehicles which is an essential requirement under the Motor Vehicle Act and the said receipts are not chargeable to Service Tax. 16. Similarly, the repossession charges received by the Appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X
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