SERVICE TAX
CENVAT Credit Rules | Storage Of Finished Goods Outside Factory Due To Space Constraints Covered Under Rule 2(l); Credit Cannot Be Denied: CESTAT
The Allahabad Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) held that storing finished goods outside the factory premises due to space constraints is connected with the assessee's business operation. Therefore, CENVAT (Central Value Added Tax) credit on 'warehousing services' is admissible as an 'input service' under Rule 2(l) of the CENVAT Credit Rules, 2004 and cannot...
Bottling Pepsi Doesn't Mean Promoting Pepsi's Goods; No Business Auxiliary Service: CESTAT Quashes Service Tax Demand
In a significant relief to SMV Beverages Pvt. Ltd., the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Mumbai has held that incentives received from Pepsi Foods for advertising and promotional activities cannot be taxed under Business Auxiliary Service (BAS). The Tribunal followed a Larger Bench ruling which categorically held that section 65(19) of the Finance Act does not...
Service Tax | Commission Earned From Foreign Suppliers Is 'Export Of Service': CESTAT Mumbai Sets Aside Demand Against Paramount Dyes
The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Mumbai has held that commission received in India for facilitating sales of goods for foreign suppliers amounts to “export of service” and cannot be taxed under the category of Business Auxiliary Service (BAS).A Bench comprising S.K. Mohanty (Judicial Member) and M.M. Parthiban (Technical Member) allowed the appeal filed...
Import Of Technical Designs Not 'Design Service'; No Extended Limitation Or Penalty: CESTAT Mumbai
The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Mumbai has delivered a significant ruling holding that import of technical know-how, engineering drawings and designs transferred permanently for manufacturing in India cannot be taxed as “Design Services” under the Finance Act, 1994.A Bench comprising S.K. Mohanty (Judicial Member) and M.M. Parthiban (Technical Member)...
Railway Receipts & STTG Certificates Are Valid Documents For Availing CENVAT Credit Before 27.08.2014: CESTAT Kolkata
The Kolkata Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) held that railway receipts and STTG (Service Tax Certificate for Transportation of Goods) Certificates are valid documents for taking CENVAT (Central Value Added Tax) Credit even prior to 27.08.2014. R. Muralidhar (Judicial Member) and K. Anpazhakan (Technical Member) opined that the STTG...
Pan Masala, Tobacco Profits Invested In Mutual Funds Not 'Trading In Securities', Service Tax Not Applicable: CESTAT Delhi
The Delhi Bench, Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has set aside service tax demand on the activity of investing in Mutual Funds as such activities undertaken by Godfrey Phillips India Limited (Appellant) would be different from 'trading in securities' and cannot be considered as an exempted service in terms of section 66D(e) of the Finance Act. In an order...
Service Tax | No Reverse Charge Liability On Software Maintenance Consumed Abroad; Hotel Expenses Not 'Sponsorship Services': CESTAT Bangalore
The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Bangalore has held that no Service Tax liability can be applied under the reverse charge mechanism on an Indian branch where the software maintenance services were contracted, received and consumed entirely outside India. The Tribunal further held that payments made towards hotel expenses of guests cannot be treated...
Staff Reimbursement, Training, And Hospital Management In Joint Venture Not Taxable Under Service Tax: CESTAT Chennai
The Chennai Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that staff reimbursement, training, and hospital management in a joint venture are not taxable under the service tax. P. Dinesha (Judicial Member) and Vasa Seshagiri Rao (Technical Member) stated that the receipts characterised as “royalty”/“management fee” are integrally connected...
Revenue-Sharing With Diagnostic Labs Not 'Business Support Service': CESTAT Sets Aside Service Tax Demand
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chandigarh has held that revenue-sharing arrangements between a hospital and diagnostic service providers (DSPs) do not amount to provision of “Business Support Service” (BSS) under the Finance Act, 1994, and are therefore not liable to service tax. A Division Bench comprising Justice S.S. Garg (Judicial Member) and...
Service Tax Not Payable On Royalty Received For Group Companies' Use Of Copyrighted Logo: CESTAT
The Chennai Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that service tax is not payable on royalty received for group companies' use of the copyrighted 'TTK' Logo founded by T.T. Krishnamachari & Co. (assessee). Ajayan T.V. (Judicial Member) and Ajit Kumar (Technical Member) examined whether the demand of service for the 'TTK' logo of the...
Service Tax Refund Cannot Be Denied On Limitation When Deposit Was Made During Investigation: Chhattisgarh High Court
The Chhattisgarh High Court has held that service tax deposited during the course of investigation cannot be denied refund merely on the ground of limitation under Section 102(3) of the Finance Act, 1994, especially when the department itself later drops proceedings and acknowledges non-liability. The Division Bench of Justice Rajani Dubey and Justice Amitendra Kishore Prasad...
Transfer Of Title In Immovable Property Doesn't Attract Service Tax : Supreme Court
The Supreme Court has clarified that an activity which merely involves the transfer of title in immovable property by way of sale cannot be treated as a “service” under the Finance Act, 1994. Consequently, such transactions lie outside the ambit of service tax.A bench comprising Justices JB Pardiwala and Sandeep Mehta delivered the verdict while dismissing an appeal filed by the...