2016 (12) TMI 1698 - AT - Service Tax

Revenue's Appeal Dismissed for Service Tax Refund Inclusion

The Tribunal dismissed the Revenue's appeal against the inclusion of reimbursable expenses in the assessable value for Service Tax refund. The Tribunal ... Stay of operation - valuation - includibility - reimbursable expenses - Held that: - Revenue could not produce any stay order passed by Hon’ble Apex Court staying operation of the ruling passed by Hon’ble High Court of Delhi in the said case of International Consultants and Technocrats Pvt. Ltd. Vs. Union of India [2012 (12) TMI 150 - DELHI HIGH COURT] - appeal dismissed - decided against Revenue. Issues: Appeal against Order-in-Appeal regarding inclusion of reimbursable expenses in the assessable value for Service Tax refund.Analysis:The appeal was filed by the Revenue against Order-in-Appeal No.255-ST/APPL-AGRA/LKO/2015, dated 06.07.2015. The case involved the appellant providing Management or Business Consultant Service where the Revenue contended that reimbursable expenses should be included in the assessable value. The respondent-assessee deposited &8377; 11,414/- on 06.11.2012 and sought a refund based on a ruling by the Hon'ble High Court of Delhi in the case of International Consultant and Technocrats Pvt. Ltd. Vs. Union of India. The Original Authority rejected the refund citing the Revenue's appeal before the Hon'ble Supreme Court against the High Court ruling. The Ld. Commissioner (Appeal) overturned the Original Authority's decision, stating that the High Court ruling had not been stayed by the Supreme Court, and therefore, reimbursable expenses cannot be included in the assessable value. Consequently, the refund was allowed, and the Revenue appealed to the Tribunal.The grounds raised by the Revenue in the appeal were that the department had appealed to the Supreme Court against the High Court ruling. The respondent-assessee filed cross objections arguing that since the Supreme Court had not stayed the High Court ruling, the Revenue's appeal was not maintainable. After hearing both sides, the Tribunal noted that the Revenue failed to produce any stay order from the Supreme Court regarding the High Court ruling. Therefore, the Tribunal found no merit in the Revenue's appeal and dismissed it, granting the respondent-assessee consequential relief as per the law. The cross application was also disposed of accordingly.In conclusion, the Tribunal dismissed the Revenue's appeal as they could not provide a stay order from the Supreme Court regarding the High Court ruling on the inclusion of reimbursable expenses in the assessable value for Service Tax refund. The respondent-assessee was granted the refund as per the ruling by the Hon'ble High Court of Delhi.