TaxTMI 
TaxTMI 
2016 (4) TMI 599
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.... th March 2011 of Commissioner of Service Tax, Mumbai - II which has determined tax liability of Rs. 76,02,092/-, along with interest thereon, as provider of 'banking and other financial services' for the period from August 2002 to March 2006. The adjudicating authority, however, did not impose penalties under section 76, 77 and 78 of the Finance Act, 1994. 2. While assessing the tax liability against the demand of Rs. 82,32,427/- in the show cause notice, the original authority has extended the benefit of 'cum-tax' valuation besides admitting the claim of the noticee that the demand for the period from 10 th September 2004 to 31 st March 2005 was barred by limitation to drop Rs. 6,13,766/- from the demand. It is also notic....
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....e Reserve Bank of India. The bonds issued would be evidenced by a stock certificate or could be held in the subscriber's name in the Bond Ledger Accounts maintained with the Public Debt office of the Reserve Bank of India or the branches concerned. The holder of the bonds in the Bond Ledger Accounts would be issued with a certificate of holding, in the prescribed form, that are not tradeable. As a broker registered with the appropriate authority, M/s JM Financial Services Pvt Ltd was entitled to a brokerage in terms of the scheme. It is this brokerage that Revenue has held to be consideration for rendering 'banking and other financial services'. M/s JM Financial Services Pvt Ltd, registered with the Securities Exchange Board of ....
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....mitation. 6. Learned Counsel relies on the decision of the Hon'ble Supreme Court in Morgan Stanley Mutual Fund v. Kartick Das [(1994) 4 SCC 225] and R D Goyal v. Reliance Industries Ltd [(2003) 1 SCC 81] to show that shares do not have existence prior to their allotment. Further reliance was placed on HDFC Bank Ltd v. Commissioner of Service Tax [2015 (37) STR 794] and Enam Securities Pvt Ltd v. Commissioner of Service Tax [2015 (37) STR 794] to contend that any transaction in connection with sale of bonds, being a statutory function that devolved on the Reserve Bank of India, was not taxable. The decision of the Tribunal in Commissioner of Service Tax v. ICICI Bank Ltd - 2015-TIOL-1983-CESTAT-MUM was cited in support of their claim th....
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....n in unrelated documents can determine taxability is contrary to all canons of taxation. A service is taxable only to the extent that it finds coverage in one of the sub-clauses of section 65 (105). It is now settled law that service tax is a tax on service and that service provider is merely incidental as the conduit for collection and deposit of tax. This has been clearly articulated by the Hon'ble High Court of Gauhati in Magus Construction (P) Ltd v Union of India [2008 (11) STR 225 (Gau)] and reiterated in a number of judgements thereafter. The Hon'ble High Court of Gujarat Sports Club of Gujarat Ltd v Union of India [2010 (20) STR 17 (Guj)] has observed that- '9. ...... Service Tax was introduced in India vide the Finance....
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....nge (forex) broking, and purchase or sale of foreign currency, including money changing; 13. We take note that section 65 (105)(zp) of Finance Act, 1994 for taxing of 'banking and other financial services' provided by 'body corporates' has been deleted with effect from 10 th September 2004 and incorporated within section 65 (105)(zm). The tax would be leviable, in the context of the present dispute, if M/s JM Financial Services Pvt Ltd was a broker dealing in the savings bonds and received brokerage as the fee thereon. 14. Brokerage is earned by a broker in the course of sale and purchase. That M/s JM Financial Services Pvt Ltd is registered as a broker with the Securities and Exchange Board of India does not render all i....