TaxTMI 
TaxTMI 
2025 (6) TMI 359
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.... the form of processing fee, sale of passbook, consultancy fee, admission fee, documentation fee, risk fund fee etc. from the borrowers. The appellants being under the impression that they are not carrying any function related to banking or financial institution did not take any Service Tax Registration nor were they charging any Service Tax on the borrowers nor were they paying the Service Tax to the Department. The Departmental officials visited the unit of the appellant on 24.01.2013. They found that Service Tax was not being paid on such services. Initially, the demand was quantified at Rs.20,55,005. Subsequently, the Show Cause Notice was issued after verifying all their records wherein the demand of Rs.75,99,646/- has been made for th....
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.... and other fees on which the appellant is required to pay the Service Tax. He further submits that no Service Tax has been quantified on the "interest" received by appellant since the same is exempted. He justifies the confirmed demand and prays that the appeal may be dismissed. 5. Under Section 65(11) banking company has been defined as under: "Banking company" has the meaning assigned to it in clause (a) of Section 45A of the Reserve Bank of India Act, 1934 (2 of 1934):" 6. Under Section 65(45) financial institution has been defined as under: "Financial Institution" has the meaning assigned to it in clause (c) of Section 45-I of the Reserve Bank of India Act, 1934 (2 of 1934);" 7. From the above definitions, it is seen that in orde....
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....interest" is defined as under: "(30) "interest" means interest payable in any manner in respect of any moneys borrowed or debt incurred (including a deposit, claim or other similar right or obligation) but does not include any service fee or other charge in respect of the moneys borrowed or debt incurred or in respect of any credit facility which has not been utilized;" 10. From the above definition, it can be seen that the Service Tax exemption is granted only for "interest" as specified above. Other "service fee" and "other charges" in respect of monies borrowed or debt incurred are not termed as 'interest'. Therefore, we do not subscribe to the view of the appellant that 'admission fee' and 'other charges' which are being levied on th....