https://www.taxtmi.com/caselaws?id=438273 Service tax was not chargeable on liquidated damages recovered from vendors for delay or non-performance, because such amounts were compensatory or deterrent in nature and not consideration for an independent taxable service. For the period before 01.07.2012, liquidated damages did not fall within section 65(105) of the Finance Act, 1994; for the period after 01.07.2012, they also did not amount to consideration under section 66E(e) for agreeing to refrain from an act, tolerate an act or situation, or do an act, as the contract did not create a separate service of toleration with consideration. The demand was therefore unsustainable. en-us Mon, 22 May 2023 00:00:00 +0530 Sat, 27 May 2023 09:31:55 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=438273 Service tax was not chargeable on liquidated damages recovered from vendors for delay or non-performance, because such amounts were compensatory or deterrent in nature and not consideration for an independent taxable service. For the period before 01.07.2012, liquidated damages did not fall within section 65(105) of the Finance Act, 1994; for the period after 01.07.2012, they also did not amount to consideration under section 66E(e) for agreeing to refrain from an act, tolerate an act or situation, or do an act, as the contract did not create a separate service of toleration with consideration. The demand was therefore unsustainable. Case-Laws Service Tax Mon, 22 May 2023 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=438273