TaxTMI 
TaxTMI 
Leviability of Service Tax on the declared service “Agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act" under clause (e) of section 66E of the Finance Act, 1994
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.... Department of Revenue Central Board of Indirect Tax & Customs (CX & ST Wing) New Delhi, dated: 28th February, 2023 To, 1. The Principal Chief Commissioner / Chief Commissioner, CGST & CX (All) 2. The Principal Director General/ Director General (All) 3. The Principal Commissioner / Commissioner, CGST & CX (All) 4. [email protected] for uploading the Circular on CBIC's web....
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....ns of law, and its applicability to service tax related issues. 2. It may be seen that "Agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act" is a Declared Service as per clause (e) of section 66E of the Finance Act, 1994. A service conceived in an agreement where one person agrees to an obligation to refrain from an act or to tolerate....
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....he obligation to refrain from an act or to tolerate an act or a situation, or to do an act is nothing but a contractual agreement. A contract to do something or to abstain from doing something cannot be said to have taken place unless there are two parties, one of which expressly or impliedly agrees to do or abstain from doing something and the other agrees to pay consideration to the first party ....
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.... decided not to pursue the Civil Appeals filed before the Apex Court in M/s South Eastern Coalfields Ltd. supra (CA No. 2372/2021), M/s Paradip Port Trust (Dy. No. 24419/2022 dated 08-08-2022), and M/s Neyveli Lignite Corporation Ltd (CA No. 0051-0053/2022) on this ground. 6. In view of above, it is clarified that the activities contemplated under section 66E(e), i.e. when one party agrees to ref....