Corporate guarantee without consideration is outside service tax, and valuation cannot create taxability where none exists.

Provision of a corporate guarantee without consideration is not a taxable service under section 65B(44) of the Finance Act, 1994 in the post-negative list regime. Taxability under section 66B depends on an activity for another supported by consideration; where no commission, fee, or other consideration is shown, the transaction falls outside service tax. Non-monetary benefits may be relevant to valuation under section 67, but they cannot create taxability when the basic charging condition is absent. On that basis, a remand for quantification serves no purpose if the demand is founded on a non-taxable transaction.

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Issues: Whether the provision of corporate guarantee without consideration is exigible to service tax, and whether a remand for quantification can be sustained when no taxable consideration is shown.

Analysis: The dispute turned on the requirement of consideration under section 65B(44) of the Finance Act, 1994 in the post-negative list regime. The controlling principle applied was that taxability under section 66B arises only when there is an activity for another supported by consideration; in the absence of consideration, the activity does not amount to service. The material on record did not establish any commission, fee, or other consideration for the corporate guarantee, and the reasoning that non-monetary benefits may bear on valuation under section 67 did not cure the absence of taxability itself. Since the demand was founded on a transaction lacking consideration, remand for quantification would serve no purpose.

Conclusion: The corporate guarantee provided without consideration was not taxable as service, and the remand order was unsustainable. The appeal was allowed in favour of the assessee.

Ratio Decidendi: In the absence of consideration, provision of a corporate guarantee does not constitute a taxable service under section 65B(44) of the Finance Act, 1994, and valuation principles cannot be invoked to create taxability where none exists.

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