SERVICE TAX
Works Contract Service Provided To CESC For Transmission Or Distribution Of Electricity Not Liable To Service Tax: CESTAT Kolkata
The Kolkata Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) held that works contract service provided to Calcutta Electricity Supply Corporation (CESC) for transmission or distribution of electricity is not liable to service tax. Ashok Jindal (Judicial Member) and K. Anpazhakan (Technical Member) examined whether the works contract service provided by the assessee to Calcutta Electricity Supply Corporation (CESC) for transmission or distribution of electricity is...
Service Tax | Sale Of Popcorn & Beverages At Cinema Counters Is Not Service, No Service Tax Payable: CESTAT Delhi
The Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal has set aside a service tax demand of over ₹18.84 crore against assessee, holding that the sale of food and beverages such as popcorn, snacks and soft drinks at cinema counters amounts to sale of goods and does not involve any element of “service” under the Finance Act, 1994. A Bench comprising Judicial Member Binu Tamta and Technical Member P.V. Subba Rao was hearing an appeal filed by M/s Cinepolis India...
Tax Paid During Probe Must Be Refunded Once No Liability Found: Chhattisgarh High Court Allows Service Tax Refund
The High Court of Chhattisgarh has allowed a service tax appeal filed by an assessee, setting aside orders passed by the department and the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) which had rejected a refund claim as time-barred under Section 102(3) of the Finance Act, 1994 . A Division Bench of Justice Rajani Dubey and Justice Amitendra Kishore Prasad was hearing an appeal challenging CESTAT's order that denied refund of ₹14.89 lakh deposited by the assessee during...
No Break-Up, No VAT Proof: CESTAT Allahabad Upholds ₹2.19 Crore Service Tax Demand Against Lakmé Franchise Beauty Salon
The Allahabad Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) held that in the absence of any documentary break-up between service receipts and retail sale of goods, the entire receipts of the Lakme Franchise beauty salon are liable to service tax. P. Dinesha (Judicial Member) and Sanjiv Srivastava (Technical Member) stated that no Notes on Accounts, which would have been part of the audited balance sheet/ profit and loss account, showing the proceeds from the...
Levy Of Service Tax On 'Access To Amusement Facilities' Unconstitutional: Kerala High Court
The Kerala High Court held that the levy of service tax on 'access to amusement facilities' is unconstitutional, as the entire activity squarely falls within the State's taxing power under Entry 62 of List II (entertainments and amusements) of the Constitution of India.Justices A. Muhamed Mustaque and Harisankar V. Menon stated that the provisions of the Entertainments Tax Act also seek to impose tax on the entire consideration received by the assessee from their clients/customers. The question...
Service Tax | Pairing & Testing Smart-Cards For Set-Top-Boxes Qualifies As Job Work: Bombay High Court Allows Credit
The Bombay High Court has upheld the Mumbai Tribunal's decision allowing Dish TV to retain CENVAT Credit on imported smart cards, which were used for testing and pairing with Set Top Boxes. A Division Bench comprising, Justice Vibha Kankanwadi and Justice Hiten S. Venegavkar dismissed the appeal filed by the Service Tax Department against order by the Mumbai, Customs, Excise and Service Tax Appellate Tribunal (CESTAT) that after verifying accounting records held in favour of Dish TV....
Service Tax | Windmill Installation, Commissioning Services Construable As 'Input Service', Credit Admissible: Gujarat High Court
The Gujarat High Court has allowed CENVAT credit of service tax paid on input used in setting up of a Windmill, away from factory premises, on the strength of nexus of the inputs with output activity, electricity generation. A Division Bench comprising, Justice Bhargav D. Karia and Justice Pranav Trivedi in twin writ petitions has set aside order of CESTAT Ahmedabad that disallowed CENVAT credit on the ground that credit of inputs and input services utilized away from the factory site...
Service Tax | Extended Limitation Cannot Be Invoked Without Mens Rea, Deliberate Intent To Evade Duty To Be Proven: CESTAT Chandigarh
The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has set aside a service tax demand of ₹18.95 crore raised against the assessee, KEC International, holding that the Department wrongly invoked the extended period of limitation without establishing any intent to evade tax . A Bench comprising Hon'ble Mr. S.S. Garg (Judicial Member) and Hon'ble Mr. P. Anjani Kumar (Technical Member) allowed the appeal filed by the assessee and quashed the...
Service Tax | Tax Paid Under Wrong Service Category Cannot Be Demanded Again: CESTAT Mumbai
The Mumbai Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has set aside a service tax demand raised against the assesse, holding that once service tax has already been paid under the Reverse Charge Mechanism, merely under a wrong service category, the department cannot demand the same tax again.A Bench comprising Dr. Suvendu Kumar Pati (Judicial Member) allowed the assessee's appeal and quashed the order passed by the Commissioner (Appeals), granting...
Service Tax Cannot Be Levied On Membership & Participation Fees Paid To Foreign Associations Before 01.07.2012: CESTAT Chennai
The Chennai Bench of Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) held that service tax cannot be levied on membership and participation fees paid to foreign associations such as International Packaging Group (IPG) or International Packaging Forum Network (IPFN) for the period prior to 01.07.2012. P. Dinesha (Judicial Member) and Vasa Seshagiri (Technical Member) stated that the demand for the period prior to 1.7.2012 on IPG/IFPN is unsustainable as there was no...
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 be denied.P.K. Choudhary (Judicial Member) stated that how a business has to be run cannot be dictated...
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 cover promotion of brand name or trademark of a client.A Bench comprising Mr. S.K. Mohanty (Judicial...