Dependent Agent PE unresolved for lack of factual inquiry; arm's-length distribution accepted; royalty claim rejected; 15% refund interest (Section 24...
Exemption under s.10(23C)(iiiad) upheld; appeal allowed, interest and dividends excluded from annual receipts, disallowance deleted, capital gains exe...
The CESTAT allowed the appellant's appeal, set aside the impugned order and quashed demands for service tax, interest and penalties insofar as they related to forfeited earnest money, security deposits, fines and penal charges. The Tribunal held such forfeitures are penal in nature and lack nexus with any taxable "consideration" for the declared service under section 66E(e) of the Finance Act, 1994; they do not constitute consideration for agreeing to refrain or tolerate an act and therefore are not includible in taxable value. The adjudicating authorities were rebuked for disregarding precedent, characterized as judicial indiscipline, and were warned to exercise greater care in future proceedings.
The CESTAT allowed the appellant's appeal, set aside the impugned order and quashed demands for service tax, interest and penalties insofar as they related to forfeited earnest money, security deposits, fines and penal charges. The Tribunal held such forfeitures are penal in nature and lack nexus with any taxable "consideration" for the declared service under section 66E(e) of the Finance Act, 1994; they do not constitute consideration for agreeing to refrain or tolerate an act and therefore are not includible in taxable value. The adjudicating authorities were rebuked for disregarding precedent, characterized as judicial indiscipline, and were warned to exercise greater care in future proceedings.
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