TaxTMI 
TaxTMI 
2025 (7) TMI 149
X X X X Extracts X X X X
X X X X Extracts X X X X
....show cause notices SCN issued to M/s. National Productivity Counsel of India respondent covering the period 2006-2007 to 2015-2016. The impugned order confirmed service tax demand of Rs. 4,40,408/- out of the total demands of Rs. 4,42,75,052/- raised in the SCNs under section 73 of the Finance Act, 1994 Act and dropped the remaining part of the demand. It also imposed penalty of Rs. 4,40,408/- under section 78 of the Act and penalty of Rs. 10,000/- each under sections 77(1) and 77(2) of the Act on the respondent. 2. Revenue is aggrieved by the impugned order and filed this appeal with a prayer to determine whether the following were correct and legal: a) allowing reimbursable expenses at a standard rate instead of actual expense....
X X X X Extracts X X X X
X X X X Extracts X X X X
....it was felt that it was not legal and proper on three counts. (iii) The demand of service tax in the SCNs included reimbursable expenses collected by the respondent. In its reply to the SCNs, the respondent relied on the judgment of the Delhi High Court in Intercontinental Technocrats and Consultants 2013 (29) S.T.R. 9 (Del.) in which it was held that no service tax could be charged on the reimbursable expenses. Revenue's appeal against Intercontinental Technocrats and Consultants was dismissed by the Supreme Court 2018 (10) G.S.T.L. 401 (S.C.). The Commissioner, however, erred in not ascertaining the exact value of such reimbursable expenses and instead allowing such expenses based on the standard rate of expenses claimed by the r....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... other reimbursable expenses such as board and lodging. It collected some amounts towards training and certain amount towards the reimbursable expenses. (iii) The Commissioner dropped the demand of service tax on the reimbursable expenses as held in Intercontinental Consultants and Technocrats. (iv) The impugned order is correct and proper and calls for no interference. Findings 5. We have considered the submissions advanced by both sides and perused the records. There is no dispute that as per Intercontinental Consultants reimbursable expenses cannot be charged to service tax and the demands need to be dropped to that extent. Revenue's first submission is that the Commissioner had accepted the reimbursable expenses ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....th the tax, so is it with the deductions on account of reimbursable expenses. If there is no doubt that reimbursable expenses were incurred and amounts on that account were collected but the exact figures are not available, the officer has to use his best judgment. It is evident that the exact figures were not available as otherwise Revenue would have provided the figures and proof before us. We, therefore, find no reason to interfere with the best judgment of the Commissioner with respect to the value of the reimbursable expenses incurred by the respondent. 7. Revenue's second submission is that for the year 2011-2012, SCNs were issued on the basis of best judgment assessment. The Commissioner accepted the respondent's submission that i....