TaxTMI 
TaxTMI 
2024 (11) TMI 613
X X X X Extracts X X X X
X X X X Extracts X X X X
....ellants are rendering various taxable services like consulting Engineer Services; Erection, commissioning and Installation services; Maintenance and repair services; Construction services etc., during the relevant period. Alleging that the appellants are recovering liquidated damages for delay in execution of supply contract and service contract as per the agreement between the appellant with their clients, show-cause notices were issued to them for the period from 01.07.2012 to 30.06.2017 for recovering Service Tax amounting to Rs.2,89,31,686/- and Rs.1,52,04,483/- along with interest and penalty. Both the show-cause notices had been adjudicated by the Commissioner in confirming the total demand of Rs.2,89,31,686/- along with interest and ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n South Eastern Coalfields and they are as follows: "25. It is in the light of what has been stated above that the provisions of section 66E(e) have to be analyzed. Section 65B(44) defines service to mean any activity carried out by a person for another for consideration and includes a declared service. One of the declared services contemplated under section 66E is a service contemplated under clause (e) which service is agreeing to the obligation to refrain from an act, or to tolerate an act or a situation, or to do an act. There has, therefore, to be a flow of consideration from one person to another when one person agrees to the obligation to refrain from an act, or to tolerate an act, or a situation, or to do an act. In other words, t....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... an agreed consideration. It is not the intention of the appellant to impose any penalty upon the other party nor is it the intention of the other party to get penalized. 28. It also needs to be noted that section 65B(44) defines "service" to mean any activity carried out by a person for another for consideration. Explanation (a) to section 67 provides that "consideration" includes any amount that is payable for the taxable services provided or to be provided. The recovery of liquidated damages/penalty from other party cannot be said to be towards any service per se, since neither the appellant is carrying on any activity to receive compensation nor can there be any intention of the other party to breach or violate the contract and suffer....