2019 (3) TMI 1218

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....al Order No.40457 of 2016, dated 09.03.2016. 2.The above appeal was admitted, on 07.10.2016, on the following substantial question of law:- "Whether the CESTAT is right in holding that reimbursement charges are not liable to Service Tax when Sec.67(1)(i) of the Finance Act provides that where service tax is chargeable on any taxable service with reference to its value, then such value shall in a case where the provision of service tax is for a consideration in money, be the gross amount charges by the service providers for such service provided." 3.Heard Mr.A.P.Srinivas, learned Senior Standing Counsel for the appellant/Revenue; and Mr.J.Shankarraman, learned counsel for the respondent/assessee. 4.The learned counsel for t....

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.... ................. 25.Obviously, this Section refers to service tax, i.e., in respect of those services which are taxable and specifically referred to in various sub-clauses of Section 65. Further, it also specifically mentions that the service tax will be @ 12% of the value of taxable services. Thus, service tax is reference to the value of service. As a necessary corollary, it is the value of the services which are actually rendered, the value whereof is to be ascertained for the purpose of calculating the service tax payable thereupon. 26.In this hue, the expression such occurring in Section 67 of the Act assumes importance. In other words, valuation of taxable services for charging service tax, the authorities are....

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.............. ................. 31.In the present case, the aforesaid view gets strengthened from the manner in which the Legislature itself acted. Realising that Section 67, dealing with valuation of taxable services, does not include reimbursable expenses for providing such service, the Legislature amended by Finance Act, 2015 with effect from May 14, 2015, whereby Clause (a) which deals with consideration is suitably amended to include reimbursable expenditure or cost incurred by the service provider and charged, in the course of providing or agreeing to provide a taxable service. Thus, only with effect from May 14, 2015, by virtue of provisions of Section 67 itself, such reimbursable expenditure or cost would also form pa....

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....a legislation has to be interpreted, one established rule is that unless a contrary intention appears, a legislation is presumed not to be intended to have a retrospective operation. The idea behind the rule is that a current law should govern current activities. Law passed today cannot apply to the events of the past. If we do something today, we do it keeping in view the law of today and in force and not tomorrow's backward adjustment of it. Our belief in the nature of the law is founded on the bedrock that every human being is entitled to arrange his affairs by relying on the existing law and should not find that his plans have been retrospectively upset. This principle of law is known as lex prospicit non respicit: law looks forward....