2018 (6) TMI 1358

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.... during the course of audit of the records of the appellant, it was noticed that the service charges collected / received as net income as per Profit & Loss Account were higher than that shown in the ST3 returns filed by the appellant. On enquiry, the appellant submitted that there were instances where the reimbursable expenses collected from the customers were higher than the expenses actually incurred by them and the differential amount was accounted by them as service charges, though no service tax was paid on this amount. As the taxable value for Custom House Agent was the gross amount charges, the amounts collected in excess were also liable to be included in the taxable value. Further the allegation against the appellant is that as pe....

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....and has been settled by the Apex Court in the case of UOI Vs. Intercontinental Consultants and Technocrats Pvt. Ltd. [2018-TIOL-76-SC-ST] wherein the Supreme Court has held as under:- Service Tax - Valuation - inclusion of the expenditure or costs incurred by the service provider in the course of providing the taxable service - Rule 5(1) of the Service Tax (Determination of Value) Rules - only with effect from May 14, 2015, such reimbursable expenditure or cost would also form part of valuation of taxable services for charging service tax.: Undoubtedly, Rule 5 of the Rules, 2006 brings within its sweep the expenses which are incurred while rendering the service and are reimbursed that is, for which the service receiver has made the payme....