Failure To Specify Statutory Provisions Vitiates Service Tax Demand: CESTAT Chennai

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Chennai, on 17 March set aside a service tax demand against Trade Line, holding that the Department cannot proceed when it fails to put the taxpayer on notice of the statutory provisions applicable to the relevant period. The Bench comprising Technical Member M. Ajit Kumar and Judicial Member Ajayan T.V. held:“We also find that the Appellant has rightly contended that the Show Cause Notice No.30/2013 dated 18.09.2013 has not put...

CESTAT Chandigarh Allows Indus Towers Appeals, Upholds CENVAT Credit On Telecom Towers, Shelters, Input Services

The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal has allowed appeals filed by Indus Towers Ltd., holding that CENVAT credit on inputs, capital goods and input services relating to telecom towers and shelters is admissibleThe dispute arose from multiple show cause notices issued for the financial years 2014–15 and 2015–16, alleging wrongful availment of CENVAT credit on inputs, capital goods and input services used for providing passive telecom infrastructure....

Service Tax Demand Unsustainable Where Warranty Services Qualify As Works Contract: CESTAT New Delhi

The New Delhi Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) on 19 March, held that a service tax demand cannot be sustained if warranty services qualify as Works Contract Services and all material particulars are duly disclosed, and that invoking the extended period of limitation is improper in the absence of suppression. A Bench of Judicial Member Dr. Rachna Gupta allowed the appeal filed by Electrocare, set aside the service tax demand raised for FY 2014–15,...

Tax Refund Cannot Be Denied As Time-Barred Where Service Was Not Provided: CESTAT New Delhi

The New Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal on 20 March held that refund of service tax paid on services which were ultimately not provided cannot be rejected on the ground of limitation under Section 11B of the Central Excise Act, 1944. A Division Bench comprising Judicial Member Binu Tamta and Technical Member Hemambika R. Priya was hearing appeals filed by Indiabulls Distribution Services Ltd against rejection of refund claims on the ground of time bar. The...

CESTAT New Delhi Grants Rs 2.93 Crore Refund To McCann Erickson, Says Refund Of Excess Service Tax Not Time-Barred

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), New Delhi has held that the Government cannot deny refund of excess service tax paid by mistake merely on the ground that the refund claim was filed after the limitation period, observing that amounts not legally payable as tax cannot be retained by the authorities. A coram of Judicial Member Dr. Rachna Gupta and Technical Member Hemambika R. Priya said that where tax is paid without any legal liability, such payment does not...

Services With Direct Or Indirect Relation To Output Service Qualify As Input Services: CESTAT New Delhi

The New Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) recently held that services such as common area maintenance, vending machine operations, and travel agent services qualify as “input services” under Rule 2(l) of the CENVAT Credit Rules, 2004, in the case of a company providing taxable services including manpower supply, rent-a-cab, business auxiliary, and legal consultancy services. The tribunal held that such services have an indirect nexus with the...

CESTAT New Delhi Sets Aside Rs. 39.64 lakh Service Tax Demand On DLF-Owned Hilton Hotel, Holds Salaries Not Taxable

The New Delhi Principal Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has allowed the appeal filed by DLF Builders and Developers Pvt. Ltd., owner of Hotel Hilton Garden Inn, Saket, and set aside a service tax demand of Rs. 39.64 lakh along with penalties, holding that salaries paid to the general manager and department heads of the hotel cannot be treated as consideration for taxable services.The dispute arose from an investigation linked to Hilton group entities,...

BCCI Subsidies To Cricket Associations Not Taxable As Service Consideration: Kolkata CESTAT

The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) on 12 March held that subsidies received by cricket associations from Board of Control for Cricket in India (BCCI) are not liable to service tax, as they are in the nature of grants-in-aid and not consideration for any taxable service. A Bench comprising Judicial Member Ashok Jindal and Technical Member K. Anpazhakan observed that there was no quid pro quo between the parties and that the amounts were provided...

VCES Immunity Bars Fresh Service Tax Demand After Discharge Certificate Is Issued: CESTAT Chennai

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) on 12 March held that once a taxpayer declares dues under the Service Tax Voluntary Compliance Encouragement Scheme, 2013 (VCES) and obtains a discharge certificate, the Department cannot issue a fresh notice for the same period on the same issue. A Bench of Technical Member M. Ajit Kumar and Judicial Member Ajayan T.V. held that a declaration accepted under the scheme attains finality and grants immunity from...

Non-Charging Of Service Tax From Client Cannot Justify Non-Payment: CESTAT Ahmedabad

The Ahmedabad Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT) has held that non-payment of tax on the ground that the same was not charged by the taxpayer from its client cannot be a valid basis to claim bona fide belief, while also holding that commission agents, other than those dealing in agricultural produce, became liable to service tax from 9 July 2004. A coram of Judicial Member Somesh Arora observed, "The statutory provisions are clear and leave no scope for...

CESTAT Chennai Sets Aside Demand After VAT Paid On 70%, Holds Service Tax Can Apply Only On Remaining 30% Contract

The Chennai Bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) has held that in a works contract involving tyre retreading, where VAT had been discharged on 70% of the contract value under the prescribed method, service tax could be levied only on the remaining 30%, observing that the same portion cannot be subjected to both levies.A bench of Judicial Member Ajayan T.V. and Technical Member M. Ajit Kumar allowed the appeal filed by Madurai-based Super Transports (P)...

CENVAT Credit Reversal Cannot Exceed Proportionate Credit Attributable To Exempt Services: CESTAT Kolkata

The Kolkata Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has held that reversal of CENVAT credit cannot exceed the proportionate credit attributable to exempt supplies, while granting relief to Bank of India and remanding the matter for recomputation of the credit liable to be reversed. A coram of Judicial Member Ashok Jindal and Technical Member K. Anpazhakan observed that “we agree with the submission of the appellant that the demand for reversal of credit should...