TaxTMI 
TaxTMI 
TaxTMI 
2024 (6) TMI 851
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....chair, network, electricity, telephone, etc, to the personal of M/s Bajaj Alliance and M/s Sun Life Insurance for providing insurance service during the period from 01/04/2010 to 30/06/2011 and from 01/07/2011 to 31/03/2012. It appeared that the service for supply of the above infrastructure was taxable under the category of 'Business Support Services' under section 65(104c) of FA 1994. Hence, two show cause notices were issued for the said periods demanding duty and seeking to impose a penalty on the appellant. After following the due process, the learned Original Authority has confirmed the demands and imposed a penalty on the appellant, aggrieved by the said order, the appellant had filed appeals before the Commissioner Appeals, Tiruchirappalli, who has upheld the order of the Lower Authority and hence this appeal before us. 3. We have heard the learned Counsel Shri S. Ananthan and Ms. R. Lalitha, Chartered Accountants who appeared on behalf of the appellant and the learned Smt. Anandalakshmi Ganeshram, learned Assistant Commissioner (AR) who appeared on behalf of Revenue. 4. The learned counsels for the appellant have stated that they as a bank are acting as corporate agents ....
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....e legislature amended the Finance Act 2015 with effect from 14/05/2015 that reimbursable expenditure whose cost could also form part of valuation of taxable services for charging service tax, hence, there was no liability of service tax on the bank on the amounts reimbursed by the insurance companies. They have relied upon the following judgments in favour of their stand:- 1. Collector of Central Excise Vs. Solaris Chemtech Ltd. reported in 2007 (7) TMI 2 - Supreme Court 2. Doypack Systems Pvt. Ltd. Vs. Union of India reported in 2002-TIOL-389-SC-MISC 3. Edelweiss Tokio Life Insurance Company Ltd. Vs. Commissioner of Service Tax - IV reported in 2021 (3) TMI 614 - CESTAT Mumbai They stated that in the circumstances the imposition of duty liability and penalties is unjustified and untenable in law and the impugned order merits to be set aside. 5. The learned AR on behalf of Revenue took us through the Order in Original (OIO) and the impugned order. She stated that the service of providing infrastructural and communication facilities by the appellant to insurance companies is a service distinct from the 'Corporate Insurance Agent Services' provided by them to the insurance co....
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....arties. Every such contract expresses the autonomy of the contractual parties' private will. It creates reasonable, legally protected expectations between the parties and reliance on its results. Consistent with the character of purposive interpretation, the court is required to determine the ultimate purpose of a contract primarily by the joint intent of the parties at the time the contract so formed. It is not the intent of a single party; it is the joint intent of both the parties and the joint intent of the parties is to be discovered from the entirety of the contract and the circumstances surrounding its formation. 6.1 As per section 182 of the Indian Contract Act, 1872 an 'agent' is a person employed to do any act for another, or to represent another in dealings with third persons. The person for whom such act is done, or who is so represented, is called the 'principal'. 6.2 Agency in law connotes the relation which exists where one person has an authority or capacity to create legal relations between a person occupying the position of principal, and third parties. As per the Hon'ble Supreme Court's judgment in State of Bihar Vs Dukhul Das [AIR 1962 Patna 14....
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....se he gives advice or supplies information in matters of business. The crucial test of the status of an agent is that his acts bind the principal. No such binding action of interacting on behalf of the insurance companies for selling insurance policies to third parties has been demonstrated to have been undertaken by the appellant. Nor are the payments received as a percentage of the business generated. The payments are received against specific support activities undertaken by the appellant. 7. We find that the actions of the appellant have not been shown to create any legal relations between the principal (insurance companies) and third parties. In fact the activities of the appellant mentioned above are other than that of selling insurance policy independently on behalf of the insurance companies and are limited to providing business support to the insurance companies and are correctly classifiable under the category of 'Business Support Services' under section 65(104c) of FA 1994. Hence their appeal must fail. 7.1 The appellant has stated that as per the Hon'ble Supreme Court's judgement in Intercontinental Consultants (supra), there was no liability of service tax on the ban....