2023 (10) TMI 169

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....g the show cause notice dated 30.09.2016 issued for the period 01.07.2012 to 31.03.2015 and the Statement of Demand dated 18.04.2018 issued for the period 01.04.2015 to 31.02.2017. While the first show cause notice makes a demand of Rs. 3,54,98,432/-, the Statement of Demand makes a demand of Rs. 7,46,84,011/-. 2. The issue involved in both the appeals is regarding applicability of service tax on corporate guarantee for associate enterprise. The appellant claims that it has not received any consideration from the associated enterprise for providing the corporate guarantee and this fact is not disputed by the respondent. 3. The Commissioner held that the appellant had provided service since it provided corporate guarantee to banks on b....

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.... definition of service applicable w.e.f. 01.07.2012 onwards and the value of service has rightly been determined as per Rule 3(b) of the Service Tax (Determination of Value) Rules, 2006 read with Section 67(ili) of the Finance Act, 1994 and the Notice is liable to pay service tax on the said value." (emphasis supplied) 4. This issue has been decided by the Supreme Court in Commissioner of CGST and Central Excise vs. M/s Edelweiss Financial Services Ltd [2023 (4) TMI 170-SC Order] and the relevant portion of the decision of Supreme Court is reproduced below: "4. Responding to the above, Mr. Bharat Rai Chandani, learned counsel for the assessee on caveat would read Section 65 (12) of the Finance Act, 1994 to point out that issu....

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....e, as defined in section 65B(44) of Finance Act, 1994, for the disputed period after introduction of 'negative list' regime of taxation has been rightly construed by the adjudicating authority. Any activity must, for the purpose of taxability under Finance Act, 1994, not only, in relation to another, reveal a 'provider', but also the flow of 'consideration for rendering of the service. In the absence of any of these two elements, taxability under Section 66B of Finance Act, 1994 will not arise. It is clear that there is no consideration insofar as 'corporate guarantee' issued by respondent on behalf of their subsidiary companies is concerned. 9. The reliance placed by Learned Authorised Representative on the....