2022 (11) TMI 1544

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....ding output services, the appellant had incurred certain expenditure viz. Custom Duty, Octroi Duty, Warehousing Charges, etc., on behalf of its customers. Such expenditure is incurred under express instructions from the customers and is recovered on actual basis by way of reimbursement from the customers. Since, the appellant did not pay service tax on such reimbursable expenses incurred by them, the department-initiated show cause proceedings, seeking recovery of the service tax amount along with interest and for imposition of penalties. The matter arising out of the show cause notices was adjudicated upon by the learned Commissioner of Service Tax, Mumbai - VII vide the impugned order dated 02.01.2017, wherein the proposed demands in resp....

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....he purpose of charging service tax on the said service. Sub-rule (2) of Rule 5 ibid has provided that the expenditure or costs incurred by the service provider as a pure agent of the recipient of the service, shall be excluded from the value of the taxable service, upon fulfillment of the conditions itemized therein. 4. On perusal of the case records, we find that the learned adjudicating authority has included various costs and expenditure incurred by the appellant for provision of the taxable service, for the purpose of determination of the value of service and for payment of service tax thereon. At paragraph 14 in the impugned order, the learned adjudicating authority has held that the notice (appellant herein) does not qualify to be co....