Licence Fees Paid By Odisha Beverages Corp To State Government Not Consideration For Service: CESTAT Kolkata

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata has held that licence fees and additional licence fees paid by Odisha State Beverages Corporation Limited to the Government of Odisha do not constitute consideration for any taxable service.A coram comprising Judicial Member R. Muralidhar and Technical Member K. Anpazhakan allowed the appeal filed by the state government undertaking. It set aside the service tax demand of ₹53.88 crore, along with interest and penalties.The...

Taxpayer Can't Be Denied Sabka Vishwas Benefit Over Tax Quantification Sent To Bank: Bombay High Court

The Bombay High Court on 22 September held that a taxpayer cannot be denied the benefit of the Sabka Vishwas (Legacy Dispute Resolution) Scheme merely because the department quantified its service tax liability in a communication addressed to the taxpayer's bank rather than directly to the taxpayer. A Division Bench of Justices M.S. Karnik and Sandesh D. Patil allowed RG Studios' petition challenging the rejection of its declaration under the Scheme, under which the firm had declared service...

CESTAT Chennai Quashes ₹1.26 Lakh Demand Against Canbank Factors Over 'Bank Charges' Classification

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai, on 23 September set aside the service tax demand of Rs. 1,26,841 against Canbank Factors Limited, holding that the Department had failed to establish the taxable character of the disputed receipts. A Bench comprising Technical Member Vasa Seshagiri Rao and Judicial Member Ajayan T.V. held that bank charges cannot be subjected to service tax merely because they are recorded under a ledger-head bearing that description,...

CESTAT Kolkata Sets Aside ₹42.78 Lakh Demand Against Belle Vue Clinic Over Expense Reimbursements

The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) on 22 September set aside the Rs. 42.78 lakh service tax demand against Belle Vue Clinic for the period October 2010 to March 2015. A Bench comprising Judicial Member R. Muralidhar and Technical Member K. Anpazhakan held that reimbursements towards proportionate common expenses could not be included in the taxable value of services before 14 May 2015, when the law was amended to specifically cover reimbursable...

CESTAT Mumbai Quashes ₹17.39 Cr. Service Tax Demand Against Navnit Motors, Says Incentives Not Taxable

The Mumbai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) on 22 September set aside a Rs. 17.39 crore service tax demand against Navnit Motors, an authorised dealer of Maruti Suzuki, BMW and Jaguar Land Rover vehicles, on incentives, discounts and reimbursements received from vehicle manufacturers. A Bench comprising Judicial Member Ajay Sharma and Technical Member M.M. Parthiban held that the receipts could not be treated as consideration for a taxable service merely...

Tax On Services From Foreign Providers Based On Receipt Date, Not Payment Date: CESTAT Chennai

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), Chennai, has held that the rate of service tax applicable to services received from foreign service providers is determined by the date of receipt, and not the subsequent date of paymentThe later date of payment to the foreign service provider does not determine the applicable rate under the reverse charge mechanism.The bench of Judicial Member Ajayan T.V. and Technical Member Vasa Seshagiri Rao observed, “We accordingly do not...

Supreme Court Issues Notice On IOCL's Plea Against Service Tax On Crude Oil Storage At Barauni Refinery

The Supreme Court on Monday issued notice on a plea filed by Indian Oil Corporation Limited (IOCL) challenging a Patna High Court ruling. The High Court had held that the terminal facility used for storing crude oil at its Barauni Refinery amounted to an independent “storage and warehousing” service liable to service tax.A Bench of Justice Manoj Misra and Justice Vijay Bishnoi briefly heard IOCL's challenge to the High Court ruling before issuing notice. The case concerns whether storage of...

Ocean Freight Service Tax Refund Claim Filed After One Year Is Time-Barred: CESTAT Delhi

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), New Delhi, has held that a refund claim for service tax paid on ocean freight was subject to the one-year limitation under Section 11B of the Central Excise Act, as applicable to service tax.Technical Member Hemambika R. Priya ruled that the relevant date for calculating the limitation was the date on which the tax was paid. The subsequent finding by the Gujarat High court that the ocean-freight levy was unconstitutional did not...

CESTAT Mumbai Allows MIRC Electronics CENVAT Credit On Commission, Insurance, Detention Charges

The Mumbai bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has allowed MIRC Electronics Ltd. (OnIda Electronics) to claim CENVAT credit on brokerage and commission, membership fees, detention charges, and insurance expenses.Judicial Member S.K. Mohanty held that these expenses qualified as “input services” under the CENVAT Credit Rules, 2004. The tribunal, however, upheld the denial of credit on staff welfare expenses relating to canteen and bus facilities.CENVAT credit...

Madras High Court Directs Refund Of ₹6.41 Lakh To The Madras Club, Says Tax Burden Not Passed On Members

The Madras High Court on 1 September directed the authorities to refund Rs.6.41 lakh to The Madras Club, after finding that the club had not passed on the tax burden to its members to that extent. A Division Bench of Justices Anita Sumanth and C. Kumarappan partly allowed the club's appeal against a CESTAT order rejecting its refund claim. The judges held: “...in respect of the portion of the amount in a sum of Rs.9,09,717/-, the appellant has already passed on the burden to its members....

Interest On EMI Loans Through Credit Cards Not Taxable As Credit Card Service: CESTAT Chennai

Holding so, the tribunal quashed the ₹249.35 crore service tax demand against Citibank

Meter Testing Naturally Bundled With Electricity Distribution, Not Taxable Separately: CESTAT Hyderabad

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Hyderabad, has ruled that meter-testing charges collected by an electricity distribution utility are naturally bundled with distribution of electricity and cannot be taxed separately. “We accordingly hold that meter-testing is ancillary and naturally bundled element of distribution of electricity. The activity takes its tax character from the principal service falling within Section 66D(k) of the Finance Act, 1994,” Judicial Member...