TMI Blog2024 (2) TMI 1132X X X X Extracts X X X X X X X X Extracts X X X X ..... does not fall within the category of any other similar service provider. Further, in the present case service tax under banking and other financial service has been demanded from the appellant on the lease and finance income received in respect of contract entered into prior to 16.08.2002. It is pertinent to note that financial leasing services provided by the appellant i.e. body corporate are taxable only from 16.08.2002 whereas in the present case service tax is sought to be demanded on the basis of the agreement prior to 16.08.2002 hence the impugned order confirming demand of service tax is liable to be set aside on this ground alone. Interest income-rental - HELD THAT:- The appellant received rent for renting equipment, further the perusal of sample copies of agreements will indicate that the appellant is only providing its equipment on rent basis to its customers and is not providing any financial leasing services. These services is entirely different from the service of financial leasing for the purpose of levy of service tax. Interest income-funding - HELD THAT:- For this purpose the appellant entered into equipment finance agreement with the customers which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed. - HON BLE MR. S. S. GARG , MEMBER ( JUDICIAL ) And HON BLE MR. P. ANJANI KUMAR , MEMBER ( TECHNICAL ) For the Appellant : Ms. Krati Singh, Advocate Present For the Respondent : Shri Rajeev Gupta, Shri Siddharth Jaiswal, Shri Aneesh Dewan and Shri Yashpal Singh , Authorized Representatives ORDER PER S. S. GARG The present appeal is directed against the impugned order dated 31.01.2013 passed by the Commissioner, Service Tax (Adjn.) New Delhi whereby the Ld. Commissioner has confirmed the demand of service tax amounting to Rs. 65,10,497/- against the appellant under banking and other financial services for the period 16.08.2002 to 31.12.2005 under Section 73 of the Finance Act 1994 along with interest under Section 75 of the Act. Ld. Commissioner has also imposed penalties of not less than Rs. 100 per day and not more than Rs. 200 per day during the period when the failure to pay service tax continues subject to the maximum limit of Rs. 65,10,497/- under Section 76 of the Act, Rs. 1,000/- under Section 77 of the Finance Act and Rs. 75,00,000/- under Section 78 of the Finance Act 1994. 2. Briefly the facts of the present case are that the appella ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any other person in Section 65(105)(zm), has to read by applying the principle of ejusdem generis with the preceding words. In support of this submission, she relied upon the following decisions : - CCE Rohtak v. Jindal Stainless Steel 2023 (6) [Final Order No. 60169/2023] - Banswara Syntec v. Commissioner of Central Excise 2010 (18) S.T.R. 68 (Tri. - Del.) - Kansai Nerolac Paints Ltd. v. Commissioner of Customs 2017 (52) STR 334 (Tri.-Mum.) - Commissioner of Central Excise v. Mohanrao Shinde SSK Ltd. 2016 (46) STR 742 (Tri.-Mum.) 7. She also submits that as the appellant is not engaged in providing banking services, therefore, the demand cannot sustain under BOFS. Hence, the impugned order is liable to be set aside. 8. Without prejudice to the above said argument She further submits that in the impugned order, the Ld. Commissioner has confirmed the demand of service tax under BOFS for providing financial leasing services without considering the actual nature of transactions of Rs. 9,37,76,673/- under following three heads: - Interest Income- Rental (Rs. 6,69,75,182/-) - Interest Income- Funding (Rs. 1,44,71,761/-) - Finance Income- Facilit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r Elevators India Pvt. Ltd. v. Commissioner of GST Central Excise, Chennai [2022-TIOL-187-CESTAT-MAD]. 13. As regards the demand of service tax on interest income-funding confirmed in the impugned order. Ld. Counsel submits that as per section 67 of the Act, the interest income on loans is excluded from the value to calculate service tax on any service and for this she relied upon the circular No. 80/10/2004-S.T. dated 17.09.2004. 14. As regards the service tax on finance income-facility Management she submits that in the impugned order, the demand of service tax was confirmed on the income received for supplying the printing/copying equipment along with an operator on the premises specified by the customer. She further submits that the appellant paid service tax on this income under Business Support Service ( BSS ) from 01.05.2006 and the department has accepted the above classification vide Order-in-Original dated 30.11.2010 and it has not preferred an appeal against the said order. She further submits that financial leasing by a body corporate is brought under service tax from 16.08.2002 and therefore the appellant will be liable for service tax only on amount received f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... further submits that the appellant fall in the definition of any other body corporate as provided in section 65(12) of the Finance Act. He further submitted that extended period of limitation has rightly been invoked because the appellant suppressed the facts by non declaration of service till 04.11.2004 whereas the service tax is leviable on BOFS w.e.f. 16.08.2002 in case of body corporate. Further, the appellant has not declared correct income under Amnesty Scheme. 18. We have considered the submissions made by both the parties and perused the material on record. Before we decide the issue involved in the present case we think it would be relevant to reproduce the definition of BOFS during the relevant time which is reproduced here in below: [(12) banking and other financial services means- (a) the following services Provided by a banking company or a financial institution including a non-banking financial company or any other body corporate or commercial concern, namely:- (i) financial leasing services including equipment leasing and hire-purchase; (ii) credit card services; (iii) merchant banking services; (iv) securities and foreign excha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e defined under Section 65(12). Such services provided to a customer by a banking company or a financial Institution including a non-banking financial company or any other body corporate or any other person to a customer are liable to service tax under Section 65(105) (zm). The expression any other person' appearing in Section 65(105)(zm) is to be read ejusdem generis with the preceding words. The expression 'other financial services appearing under Section 65(12)(a)(ix) is a residuary entry and includes, those services which are normally rendered by banks or financial institutions. 4. Hence, banking and other financial services provided by a banking company or a financial institution or a non- banking financial company or any other service provider similar to a bank or a financial institution are liable to service tax under Section 65(105)(zm) of the Finance Act, 1994. Department of Posts is not similar to a bank or a financial institution and hence does not fall within the category of any other similar service provider. 22. Further, we find that in the present case service tax under banking and other financial service has been demanded from the appellant on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iding printing/copying equipment to the customers along with operator at the premises of customers and the customer paid to the appellant per impression charges based on the usage of the machine during a month. The appellant has also produced the copies of documents management service agreement entered into with the buyer in order to show the real nature of the transaction. Further, we also find that w.e.f. 01.05.2006 the appellant is paying service tax on facility management under business support service which has been accepted by the department vide order no. 10/SIS/CST/(ADJ)/2010 dated 30.11.2010. The said order has attained finality as no appeal has been preferred by the department. Hence, we hold that for facility management, demanding service tax under financial leasing during the relevant period is not sustainable. Further, it appears to us that Ld. Commissioner has gone on presumption that this amount of Rs. 9,37,76,673/- has been received by the appellant for providing financial leasing service without taking into consideration the actual nature of the transaction. Hence, the demand is liable to be set aside and we accordingly do so. 27. We also take note of the circul ..... X X X X Extracts X X X X X X X X Extracts X X X X
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