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of <h1>Tribunal rules no service tax liability before 2005 for consulting engineer services.</h1> <h3>NESTLE INDIA LTD. Versus COMMISSIONER OF SERVICE TAX, NEW DELHI</h3> The Tribunal allowed the appeal, ruling that the appellant was not liable to pay service tax before 1-1-2005 for consulting engineer services received ... Appellant has been receiving the service of consulting Engineer from their holding company – import of services - period under dispute is from 6-8-2002 to 9-9-2004 - following the decision of the Larger Bench in the case of Hindustan Zinc Ltd. cited supra, we hold that in the present case, the appellant is not liable to pay the service tax prior to 1-1-2005 and accordingly we allow the appeal with consequential relief Issues:1. Appeal against the order-in-original of the Commissioner regarding service tax on consulting engineer service received from a holding company.2. Interpretation of the provisions of the Finance Act, 1994 related to service tax, specifically 'consulting engineer' service.3. Application of the decision in the case of Hindustan Zinc Ltd. to determine liability for service tax prior to 1-1-2005.4. Comparison of facts with previous cases and subsequent allowance of the appeal based on the decision of the Larger Bench.Analysis:1. The appeal in this case challenges the order-in-original of the Commissioner concerning the liability for service tax on the consulting engineer service received by the appellant from their holding company. The period under dispute ranges from 6-8-2002 to 9-9-2004. The Tribunal examined the provisions of the Finance Act, 1994, focusing on the definition of 'taxable service' and the charging provision under Section 66, which specified the service tax rate for services like consulting engineer service. Additionally, sections 67, 68, and subsequent sections dealt with valuation, payment, registration, filing returns, and assessment of service tax.2. Referring to the decision in the case of Hindustan Zinc Ltd., the Tribunal analyzed the relevant provisions of the Finance Act, 1994, as they stood during the period in question. The judgment highlighted the importance of Section 68, which outlines the obligation of the person providing taxable service to pay service tax as specified in Section 66. The Tribunal noted the insertion of Section 66-A in 2006, addressing the charge of service tax on services received from outside India, which clarified the liability for service tax in such cases.3. Both parties agreed that the facts of the present case aligned with those in the Hindustan Zinc Ltd. case, which had set a precedent for similar situations. The Tribunal also referenced other cases where the same decision was applied, ensuring consistency in the interpretation and application of the law. Based on the decision of the Larger Bench in the Hindustan Zinc Ltd. case, the Tribunal concluded that the appellant was not liable to pay the service tax before 1-1-2005, in line with the provisions and notifications related to taxable services provided by non-residents or entities from outside India.4. In light of the above analysis and following the precedent set by the Hindustan Zinc Ltd. case, the Tribunal allowed the appeal, granting consequential relief to the appellant. The decision was based on the specific interpretation of the relevant provisions of the Finance Act, 1994, and the application of established legal principles to determine the liability for service tax in the given scenario. The Tribunal did not delve into other grounds raised by the appellant, focusing solely on the issue of liability for service tax before 1-1-2005 as per the applicable laws and notifications.
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