TaxTMI 
TaxTMI 
2017 (9) TMI 895
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....ey are engaged in providing service to Indian garment exporters and their foreign buyers. Based on certain enquiries conducted with the appellants, Revenue initiated proceedings against them to demand and recover service tax not paid during the period 01.07.2003 to 31.03.2007 under the category of Business Auxiliary Service (BAS) in terms of Section 65 (19) of the Finance Act, 1994. Proceedings initiated against the appellant culminated in the impugned order resulting in confirmation of tax liability of Rs. 93,60,126/-. A penalty of Rs. 94,00,000/- lakhs was also imposed under Section 78 of the Finance Act, 1994. 2.1 The Ld. Counsel contesting the findings of the lower authority submitted that details of services rendered by the appellan....
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....st 01.05.2006 under BAS. For the period prior to that no tax is payable for the said services as they are now contesting only the classification of service. It is their view that their liability should be correctly categorized under BSS only. 2.3 Regarding Annexure-C, they have admitted the taxability, however past 18/04/2006, on reverse charge basis after the introduction of a new Section 66A. Prior to that date no tax liability on reverse charge basis is payable, in line with the decision of the Hon'ble High Court in Indian Ship-owners Association Vs. UOI 2009 (13) STR 235 (Bom.) was affirmed by the Hon'ble Supreme Court. 2.4 Regarding Annexure-D, the Ld. Counsel submitted that the service rendered are typically covered under BSS an....
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...., we transfer the amount of the second beneficiarys bill of exchange after deducting the Foreign Bank charges to the foreign bank account of the second beneficiarys bankers towards payment of their bill. The margin amount is credited to the fist beneficiarys (M/s. Fifth Avenue Sourcing Pvt. Ltd.) current/EEFC account with us. This way, the entire transaction comes to its logical end. 3. We send herewith the photo copies of the following documents In respect of the captioned Bill, referred to in your letter. (a) Bill of Exchange for Euro 4765.20 drawn by Second Beneficiary, East Coast Clothing Co. Ltd. Tirupur. (b) Invoice No. 05/9-9-2006 for Euro 4765.20 (c) Bill of Lading No. 701061400825 dated 16-9-2006 (d) Covering Sche....
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.... Country for which both the conditions that the recipient of service is located outside India and the consideration is received in convertible foreign exchange is fulfilled. 2.5 The Ld. AR supported the findings of the original authority relying on the decision of the Tribunal with reference to Fifth Avenue a group company of the appellant, the Ld. AR submitted that the Revenue had preferred an appeal against the said order which is admitted by the Hon'ble Supreme Court and pending decision. However, no stay has been granted by the Apex Court. He submitted that the services examined in Annexure-B are basically towards commission received from local vendors and should be classified under BAS as promotion of business activity. The classifi....
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....roduct of the vendor. Though they were registering with the department under BAS and paid service tax under such category with effect from 01.05.2006, tax liability paid after 01.05.2006 is rightly to be appropriated under BSS. This is not being contested. However, for the period prior to 01.05.2006 no tax liability will arise and same is not paid by them. 4.3 Regarding the commission paid to the foreign based agents to get business for the appellants, the appellants admitted that they are liable to pay service tax on reverse charge basis with effect from 18.04.2006. We note that in terms of the Hon'ble Bombay High Court decision in the case of Indian Shipo-owners Association (supra) no tax liability on reverse charge basis will arise pr....