TaxTMI 
TaxTMI 
2010 (4) TMI 570
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.... v. Vijay Sharma & Co. A common order dated 22-2-2010 was passed by Hon'ble High Court directing Tribunal for constitution of Larger Bench to decide the question involved in all the three cases. The question that was framed by Hon'ble High Court for answer by the Larger Bench is as under :- "Whether services provided by sub-brokers are covered under the ambit of service tax and are taxable or not?" 2. While passing the order framing the question as above, the Hon'ble High Court noticed that the Customs, Excise & Service Tax Appellate Tribunal (for short 'the Tribunal') in CEA No. 130 of 2008 has held that sub-brokers are not liable to pay any service tax as the same has already been paid by the main stock broker. Similar view has be....
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....said nature, he qualifies to be service provider of taxable service under the category of 'stock broker'. As per the statutory definition contained in section 65(101) of the Finance Act, 1994 which brings sub-broker into the scope of taxation, the claim of the present appellants that they are not liable to service tax, is inconceivable and the sub-broker is, thus, liable to service tax with effect from 10-9-2004 although initial definition under section 65(101) of Finance Act, 1994 did not include a sub-broker within the meaning of a 'stock broker'. A sub-broker not liable to service tax prior to 10-9-2004 does not enjoy same status after such date because definition under section 65(101) of the Finance Act, 1994 has under undergone amendme....
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....l be no levy of tax on the present appellants. The sub-broker having been immune from taxation, these appellants cannot be discriminatory dealt. But he submitted that it is an established fact that the sub-brokers have paid tax to the broker and the stock broker has discharged his liability, ultimately depositing the same into the treasury. 7. Heard both the sides and perused the record. 8. The dispute in all the three references is on a narrow compass. There is no dispute by either side that a sub-broker is falling under the definition of 'stock broker' under section 65(101) of the Finance Act, 1994 with effect from 10-9-2004. The definition reads as under :- "(101) 'Stock-broker' means a person, who has either made....
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.... paid by a sub-broker in respect of same taxable service provided by the stock-broker, the stock broker is entitled to the credit of the tax so paid on such service only if entire chain of identity of sub-broker and stock broker is established and transactions are provided to be one and the same. In other words, if the main stock broker is subjected to levy of service tax on the self-same taxable service provided by sub-broker to the stock broker and the sub-broker has paid service tax on such service, the stock broker shall be entitled to the credit of service tax. Such a proposition finds support from the basic rule of Cenvat credit and service of a sub-broker may be input service provided for a stock-broker if there is integrity between ....