The CESTAT set aside the demand of service tax on sale of sweet...

The CESTAT set aside the demand of service tax on sale of sweet boxes, holding it as a pure sale of goods not liable to service tax. The levy of service tax under Manpower supply services received from M/s Sonu Services was also quashed, as the tax was already paid by the service provider, and double taxation under RCM was disallowed. Service tax demand on remuneration paid to four directors was negated, recognizing director remuneration as salary exempt from service tax under Section 65B(44)(b) of the Finance Act, 1994. The disallowance of CENVAT credit of Rs.21,250/- on maintenance services was reversed, acknowledging credit eligibility under CENVAT Credit Rules, 2004. Reversal of CENVAT credit on grounds of non-payment under RCM was rejected since tax was paid by the provider. Penalties imposed were also set aside due to non-sustainability of the demands. The appeal was allowed in full.