https://www.taxtmi.com/caselaws?id=756559 CESTAT New Delhi held that liquidated damages and forfeited amounts arising from breach of contract do not constitute consideration for declared services under Section 66E(e) of the Finance Act. The appellant had agreed to supply TMT Bars, but the buyer cancelled the purchase order. The appellant forfeited amounts totaling Rs. 29,40,000 from the buyer for breach of contract. The tribunal ruled that compensation received for financial damages has no nexus with taxable services and cannot be considered as consideration for declared services. Contract cancellation itself does not constitute a service, and forfeited amounts are not taxable under service tax provisions. Appeal allowed in favor of the assessee. en-us Wed, 24 Jul 2024 00:00:00 +0530 Tue, 06 Aug 2024 07:49:40 +0530 TaxTMI RSS Generator https://www.taxtmi.com/caselaws?id=756559 CESTAT New Delhi held that liquidated damages and forfeited amounts arising from breach of contract do not constitute consideration for declared services under Section 66E(e) of the Finance Act. The appellant had agreed to supply TMT Bars, but the buyer cancelled the purchase order. The appellant forfeited amounts totaling Rs. 29,40,000 from the buyer for breach of contract. The tribunal ruled that compensation received for financial damages has no nexus with taxable services and cannot be considered as consideration for declared services. Contract cancellation itself does not constitute a service, and forfeited amounts are not taxable under service tax provisions. Appeal allowed in favor of the assessee. Case-Laws Service Tax Wed, 24 Jul 2024 00:00:00 +0530 https://www.taxtmi.com/caselaws?id=756559