2019 (10) TMI 1207

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....minus salary, PF ESI etc.). The case of the department is that the appellant are required to pay service tax on the gross amount including salary of the security guards, PF, ESI etc. Therefore, the demand of differential service tax was raised invoking the extended period. In the impugned order the Commissioner (Appeals) has extended the benefit of reduced penalty of 25% under Section 78. Aggrieved with the said relaxation, the Revenue has also filed the appeal. 2. Shri Naveen Gheewala, Learned Consultant along with Shri Amal Dave, Learned Advocate appeared on behalf of the appellant and submits that the appellant have rightly paid service tax on the service charges. The value on which demand was raised is receipt of reimbursements toward....

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....on behalf of the service recipient. Therefore, the salary of the guards, PF, ESI etc cannot be deducted from the gross value, for the purpose of charging service tax. 5. He submits that the appellant had the liberty to pay service tax demand, interest and 25% of penalty within one month from the date of adjudication order which they have failed to do so. Therefore, the Commissioner (Appeals) was wrong in extending the benefit of reduced25% penalty. Therefore, the Revenue's appeal may be allowed. He placed reliance on the following judgments:- (a) 2014 (304) ELT 342 (Uttarakhand) - Doon Security Services vs. Union of India (b) 2017 (52) STR 42 (Tri-Del) - Rajasthan Ex-Servicemen Limited vs. CCE, Jaipur-I (c) 2018 (15) GSTL 328 (Raj) ....

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.... the appellant. Therefore, it cannot be said that salary of guards, PF, ESI etc. are reimbursable expenditures to be deducted from the gross value of security service. Therefore, we do not agree with the appellant (assessee) that only the commission portion is liable to tax and not the gross value. 7. As regards the submissions made by the appellant on limitation, we find that right from the beginning the appellant were paying service tax only on the commission portion without adding the value towards salary of guards, PF, ESI etc. They have declared to the department on the said value on which the service tax is paid which is representing only commission. Therefore, the department is of the belief that the appellant is paying service tax ....