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of <h1>Tribunal excludes Passenger Service Fee and Airport Taxes from Service Tax assessment</h1> <h3>Turkish Airlines Versus C.C.E. & S.T., Delhi</h3> The Tribunal held that Passenger Service Fee (PSF) and Airport Taxes should not be included in the assessable value of services provided by the airline ... Valuation - inclusion of Passenger Service Fee (PSF) and Airport Taxes in assessable value - Held that: - Tribunal in the case of Austrian Airlines [2017 (9) TMI 625 - CESTAT NEW DELHI], has held that the P.S.F. and Airport Taxes should not be considered as a part of the taxable service provided by the appellant. Appeal allowed - decided in favor of appellant. Issues:Service Tax demand on Passenger Service Fee (PSF) and Airport Taxes.Analysis:The appellant, engaged in operating airlines, provides taxable service under the category of 'Transport of Passengers Embarking in India for International Journey by Air Service.' The Department confirmed the Service Tax demand on PSF and Airport Taxes, asserting that such value should be included in the gross value of taxable service provided by the appellant. The appellant contested this, citing precedents like the cases of Austrian Airlines, United Airlines, and Lufthansa German Airlines, where it was held that PSF and Airport Taxes should not be considered part of the taxable service provided. The Tribunal examined the issue and found that the charges were collected in compliance with Rule 6 of the Service Tax (Determination of Value) Rules, 2006. The Airport Tax was collected under the Airport Authority of India Act, 1994, and the PSF under the Aircraft Rules, 1937, both shown separately on tickets. The Tribunal also noted the exemption Notification No. 12/2010, which excludes statutory taxes on air passengers from taxable value for levy of tax. Consequently, the Tribunal held that PSF and Airport Tax are not includable in the assessable value of services provided by the appellant, setting aside the impugned order and allowing the appeal in favor of the appellant.
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