AI Drafter 
TaxTMI 
TaxTMI 
2016 (7) TMI 1036
X X X X Extracts X X X X
X X X X Extracts X X X X
.... period October 2006 to September 2008. 2. The brief fact of the case is that the appellant herein is a proprietary firm engaged in providing outdoor catering service for industrial units and educational institutions situated in and around Chennai. They are registered with service tax department under the category of "Outdoor Catering Service". The appellant's unit was taken up for routine audit between 28.10.2008 and 12.11.2008 and it was noticed non-payment of Service Tax for the period January 2008 to September 2008. It was also noticed by the Audit Team that appellant had not discharged the service tax liability on TDS amount and reimbursements received towards LPG gas and Milk from the recipient of services, to the tune of Rs. 8....
X X X X Extracts X X X X
X X X X Extracts X X X X
...., it is provided by the recipient of services and payments were made on their behalf which was later reimbursed to the Appellant. Thus the Appellant has acted as a pure agent of the recipient of services, which are not includible in the value in terms of Rule 5(2) of Service Tax (Determination of Value) Rules, 2006. Any Service Tax collected forcefully on the erroneous interpretation needs to be refunded to the Appellant. Further, the demand on this score is barred by limitation in the absence of any active suppression especially when the matter involves interpretation besides availability of set-off credit at the recipient end making the situation revenue-neutral. In any case, there cannot be levy prior to 16.6.2005, the date on which the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... CCE & ST., LTU Bangalore Vs Adecco Flexione Workforce Solutions Ltd. 2012 (26) STR 3 (Kar.). 3.5 He submits that in the matter of interpretation as to whether the reimbursement of amount towards gas and milk would be excludible under Rule 5(2) of Service Tax (Determination of Value) Rules, 2006 and would not warrant invocation of extended period of time limit, which proposition is well settled. Consequently, no penalty under Sec.78 of the Finance Act, 1994, is warranted in the facts and circumstances of the case. 3.6 He submitted that the Appellant only stand to lose by way of payment of interest @ 13% per annum if the service tax amount is not paid on the due date. The bona fides of the Appellant can be seen from the fact that he ha....
X X X X Extracts X X X X
X X X X Extracts X X X X
....lly exclusive and this submission has not been considered. Levy of tax on LPG and milk reimbursements which are not taxable under Rule 5(2) of Service Tax (Determination of Value) Rules, 2006 is barred by limitation. 4. Ld. A.R for the Revenue submits that appellant is one of the top outdoor catering service providers. In 2006 itself, SCN was issued and since it was the first incidence, the adjudicating authority did not impose the proposed penalty under Section 76 and by invoking the provisions of Section 80. However, for the subsequent proceedings, plea of bona fide cannot be accepted where reimbursements of cost of LPG and milk should be included in the gross value of service since the appellant has received money against the cost of ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....y of service tax not levied or paid or short-levied or short-paid or erroneously refunded. (3) Where any service tax has not been levied or paid or has been short-levied or short-paid or erroneously refunded, the person chargeable with the service tax, or the person to whom such tax refund has erroneously been made, may pay the amount of such service tax, chargeable or erroneously refunded, on the basis of his own ascertainment thereof, or on the basis of tax ascertained by a Central Excise Officer before service of notice on him under sub-section (1) in respect of such service tax, and inform the Central Excise Officer of such payment in writing, who, on receipt of such information shall not serve any notice under sub-section (1) ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....nd that Appellant's contention merits consideration as Appellant have always been under the belief that the value on which tax has been deposited by them was inclusive of tax and that at the insistence of the Department they had once again deposited tax. 9. As regards service tax on LPG/milk reimbursements from customer, we find that the issue revolves around interpretation of law i.e. whether reimbursement of expenditure was subject to levy of service tax in terms of Rule 5(1)of Service Tax Rules, 1994 and that the Delhi High Court in the case of Intercontinental Consultants & Technocrats Pvt. Ltd.Vs UOI - 2013 (29) S.T.R. 9 (Del.) has held that reimbursements would not be subject to levy of service tax. Also, an amendment was intro....