No Service Tax On Target-Based Discounts From Maruti Suzuki To Dealers: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that no service tax on target-based discounts from Maruti Suzuki to dealers. Dr. Rachna Gupta (Judicial) and P.V. Subba Rao (Technical Member) stated that the incentives/ discounts received by the dealers of car manufacturer were not taxable under Auxiliary Service (BAS), as they were the part of a business transaction on a principle-to-principle basis. M/s. Vipul Motors Pvt Ltd. being an...

Service Tax To Be Paid By Distributor, Not By Theatre Owner For Film Screening: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that service tax has to be paid by the distributor under “Copy Right Service” for transfer of right by licence to screen the film in the theatre of the owner. Binu Tamta (Judicial Member) and Hemambika R. Priya (Technical Member) stated that “the purpose of the agreement and the intention of the parties is for screening of the film in the theatre, which cannot be treated as “Renting of...

No Service Tax On 'Upfront Fee' Received By DMRC From Customers Under Concession Agreement: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that no service tax on 'upfront fee' received by DMRC (Delhi Metro Rail Corporation) from customers under concession agreement. Binu Tamta (Judicial Member) and Hemambika R. Priya (Technical Member) was addressing the issue of whether the “upfront fee” received by the Delhi Metro Rail Corporation Ltd. from various customers under the Concession Agreements entered prior to 1.7.2010 is exigible...

Demand U/S 73A Of Finance Act Unsustainable Without Proof Of Service Tax Collection: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that demand under Section 73A Of Finance Act unsustainable without proof of service tax collection. Dr. Rachna Gupta (Judicial Member) and Hemambika R. Priya (Technical Member) stated that “the invoice does not indicate any service tax collection by the assessee. The assessee had merely collected VAT and AAI levy from their clients, and no amount representing Service tax has been collected....

CESTAT Quashes Service Tax Demand Based Solely On Income Tax Data In Form 26AS

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that the service tax demand cannot be based solely on Income Tax Data in Form 26AS without establishing receipt of consideration. The Bench of Dr. Rachna Gupta (Judicial Member) stated that “Revenue cannot raise the demand on the basis of difference in the figures reflected in the ST-3 returns and those reflected in Form 26AS without examining the reasons for said difference and without...

Construction Sub-Contractor Cannot Escape Service Tax Liability When Main Contractor Is Taxable: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that construction sub-contractor cannot escape service tax liability when main contractor is taxable. The Bench of Binu Tamta (Judicial Member) and Hemambika R. Priya (Technical Member) has stated that the construction of residential complexes was not exempt from service tax duty. Hence, the sub-contractors were liable to discharge their service tax liability on such services provided by them...

Service Tax Not Leviable On License Fee Or Spectrum Charges Payable For Period Before 1st April 2016: CESTAT

The Chandigarh Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that service tax not leviable on license fee/spectrum charges payable for period prior to 01.04.2016. The Bench consists of S.S. Garg (Judicial Member) and P. Anjani Kumar (Technical Member) has stated that “as per the principle of ejusdem generis, the phrase “any other document issued by the Government demanding such payment” should only include documents of similar nature to an invoice,...

Service Tax Payable On Service Charges Collected From Client For Printing: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that service tax payable on service charges collected from client for printing. The Bench of Dr. Rachna Gupta (Judicial Member) and P.V. Subba Rao (Technical Member) has observed that the assessee engaged someone else to do the job of printing after preparing content using its in-house expertise. The assessee was, by no stretch of imagination a job worker to a printer. The printer, in fact,...

Bank Charges Paid To Foreign Banks Are Not Liable To Service Tax Under Reverse Charge Mechanism: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that bank charges paid to foreign banks are not liable to service tax under the reverse charge mechanism. The Bench of Dr. Rachna Gupta (Judicial Member) and Hemambika R. Priya (Technical Member) has stated that “there is direct nexus of the buyer with the Foreign Bank, and it is held that when the provider of service i.e. 'the Foreign Bank' and recipient of service i.e. 'the Buyer' are both...

Service Tax Not Leviable On Hostel Fees Received For Non-Residential Courses In Coaching Institute: CESTAT

The Kolkata Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that service tax is not leviable on hostel fees received for non-residential courses in coaching institute. The Bench of Ashok Jindal (Judicial Member) and K. Anpazhakan (Technical Member) has observed that “the stand-alone hostel charges collected for non-residential courses, have no connection with Commercial Training and Coaching services as defined under section 65(105)(zzc) of the Finance...

Actual Figures Can Be Considered To Determine Service Tax Payable By Assessee If Books Of Accounts Show Higher Figures Than Statutory Returns: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that actual figures can be considered for determining service tax payable by assessee if books of accounts show higher figures than statutory returns. The Bench of Justices Binu Tamta (Judicial) and P.V. Subba Rao (Technical) has observed that, “If the books of accounts show higher figures than the statutory returns the actual figures can be considered for determining the service tax payable...

Consultancy Services Rendered To Foreign University/Foreign Group Entity Are Not “Intermediary Services”; Service Tax Not Leviable: CESTAT

The New Delhi Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that the consultancy services rendered by the assessee to the foreign university/foreign group entity do not fall under the category of “intermediary services” and the assessee are eligible for the benefit of “export of services”. The Bench of Binu Tamta (Judicial Member) and (Technical Member) has observed that “it may also be appreciated that the final decision of admitting a student is...