SERVICE TAX
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 dated December 05, 2025 the Bench comprising Justice Dilip Gupta (President) and Shri. P..V. Subba Rao...
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 as taxable “Sponsorship Services”. A Division Bench comprising P.A. Augustian (Judicial Member) and R. ...
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 with the provision of healthcare services and do not constitute a separate taxable Management or Business...
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 P. Anjani Kumar (Technical Member) allowed the appeal filed by the assessee, NC Jindal Institute of Medical...
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 assessee used by its group companies under Intellectual Property Rights service is tenable. In the case...
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 allowed a tax appeal filed by a service tax assessee challenging the rejection of a refund claim amounting to...
Service Tax Cannot Be Levied On Rent-A-Cab Services Provided To SEZ Units: CESTAT Chennai
The Chennai Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has stated that the service tax cannot be levied on rent-a-cab services provided to Special Economic Zone (SEZ) units as per the overriding effect under Section 51 of the SEZ Act (The Special Economic Zones Act, 2005). Ajayan T.V. (Judicial Member) and M. Ajit Kumar (Technical Member) observed that the SEZ Act is a self-contained Act which provides exemptions on taxes, duties, cess, drawbacks and...
Meter Reading, Billing & Disconnection Services Are Ancillary To Electricity Distribution; Exempt From Service Tax: CESTAT Allahabad
The Allahabad Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that services, such as meter reading, billing, and connection/disconnection of electricity, are ancillary services of transmission and distribution of electricity and service tax is not payable for these services. P.K. Choudhary (Judicial Member) examined whether the services such as meter reading, collection of revenue, connection and disconnection of electricity supply would be covered under...
Services To Marriott Hotel In Hong Kong Are 'Export Of Services': CESTAT Mumbai Sets Aside Service Tax Demand
The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Mumbai has held that services rendered by Marriott Hotels India Pvt. Ltd. to its overseas group entity Marriott Hong Kong qualify as export of services, and therefore cannot be subjected to service tax under the Finance Act, 1994. A Division Bench of Member (Judicial) S.K. Mohanty and Member (Technical) M.M. Parthiban allowed three connected appeals filed by Marriott India, and set aside the entire service tax demand, ...
Extended Limitation Cannot Be Invoked Without Proof Of Intent To Evade: CESTAT Delhi Sets Aside Service Tax Demand On Car Parking Charges
The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Principal Bench, New Delhi has held that the extended period of limitation under the proviso to Section 73(1) of the Finance Act, 1994 cannot be invoked in the absence of clear evidence of suppression of facts with intent to evade service tax. A Division Bench comprising Justice Dilip Gupta (President) and P.V. Subba Rao (Technical Member) allowed the appeal against the order of Commissioner(appeals) filed by the...
No Service Tax On Cost Allocation For Pet-Care Products Of Mars International: CESTAT Hyderabad
The Hyderabad Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that Mars International is not liable to service tax on cost allocations for developing pet-care products. The bench further opined that the arrangement with the group companies did not involve a service provider-service recipient relationship, and therefore, the service is not taxable. ANGAD PRASAD (Judicial Member) and A.K. JYOTISHI (Technical Member) found that the Mars...