Service tax on bank receipts failed where no taxable service or consideration was identified from financial records.

Service tax cannot be sustained on receipts such as written-off amounts, insurance commission, postal charges recovered, and miscellaneous income where no specific taxable service, service-provider nexus, or identifiable consideration is shown. A mere comparison between ST-3 returns and financial records is insufficient to establish taxability when the receipts are treated as revenue income and the record does not support characterisation as consideration for a taxable service. On that basis, the show-cause notice and consequential order were held unsustainable.

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Issues: Whether service tax could be demanded on amounts shown under heads such as written-off amounts, insurance commission, postal charges recovered, and miscellaneous income, in the absence of identification of any taxable service and the corresponding consideration.

Analysis: The demand was founded on a comparison between ST-3 returns and financial records, but no specific service rendered by the bank, no service provider nexus, and no taxable consideration were identified for the amounts sought to be taxed. The receipts were treated as revenue income in nature, and the record did not show any legal basis for characterising them as consideration for a taxable service.

Conclusion: Service tax could not be sustained on the impugned receipts, and the show-cause notice and consequential order were held unsustainable.

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