2024 (11) TMI 128

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....the quantum of sale of vehicles during the relevant period amounts to service and whether the service tax confirmed on the said amount under the service category of 'Business Auxiliary Service' is tenable. 2. The brief facts are the appellant was in receipt of incentives from M/s. Maruti Suzuki India Ltd. (MSIL) for promotion and marketing of vehicles, spares, etc. The Department alleging that the said receipt of incentives by the appellant, as commission received for promotion, marketing, sale of goods produced or provided belonging to MSIL and that the activity is falling under the category of 'Business Auxiliary Service', a demand was raised and the Learned Commissioner confirmed the demand along with interest and also imposed p....

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.... that of a principal to an agent or client to service provider basis. Since the amount offered as incentives have already formed part of sale consideration on which Excise duty and CST/VAT has been paid, the said amount cannot be carved out and subjected to levy of service tax. The Learned Counsel relied on catena of decisions and submitted that the mutual exclusivity of levy of sales tax and service tax has been recognized by decisions of Hon'ble Supreme Court in the matter of M/s BSNL Vs. Union of India, Imagic Creative Pvt. Ltd. Vs. Commissioner of Commercial Taxes - 2008 (9) S.T.R 337 (SC), M/s Idea Mobile Communications Vs. CCE - 2006 (4) S.T.R 132 (Tri. Bang.) and M/s Pillai & Sons Motor Co. Vs. CCE - 2009 (14) S.T.R 844 (Tri. Chennai....

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.... "Business Auxiliary Services" means: - any service in relation to - (i) Promotion or marketing or sale of goods produced or provided by or belonging to the client; or (ii) Promotion or marketing of service provided by the client; or (iii) Any customer care service provided on behalf of the client; or (iv) Procurement of goods or services which are inputs for the client; or Explanation. For the removal of doubts, it is hereby declared that for the purposes of this sub-clause," input means all goods or services intended for use by the client. (v) Production or processing of goods for, or on behalf of, the client; (vi) Provision of service on behalf of the client; or (vii) A service incidental or auxiliary to any activit....