TaxTMI 
TaxTMI 
TaxTMI 
2025 (11) TMI 1278
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....hat the appellants are required to pay service tax on reverse charge mechanism. It was further observed that the appellants have engaged the services of foreign service providers for market research and on that count also, the appellants are liable to pay service tax on reverse charge mechanism. Accordingly, a show cause notice dated 26.03.2013 was issued to the appellants, seeking to recover service tax amounting to Rs.55,90,634/- along with interest while seeking to impose penalties under Sections 76,77 &78 of Finance Act, 1994. The show cause notice was adjudicated by Commissioner vide the impugned order dated 19.11.2014 confirming service tax of Rs.55,49,508/- along with equal penalty under Section 78 and penalty of Rs.200/- per day under Section 77 and an amount as per Section 70 of the Finance Act, 1994. Hence, this appeal. 2. Shri Naveen Bindal, learned Counsel for the appellant submits that the Commissioner has erred in confirming the demand and also in quantification of the same. As regards the demand on Right to Use Tangible Goods Service, learned Counsel submits that the order considered the figure of rent as Rs.74,34,775/- in place of Rs.63,85,500/- and rent of immov....
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.... 5. Learned Counsel for the appellants also submits that the demand has been raised invoking extended period; however, show cause notice, dated 26.03.2013 was issued to cover a period, from 01.04.2007 to 30.09.2007, which is even beyond five years. He submits that even extended period cannot be invoked as the issue involved is about legal interpretation of provisions of Service Tax; the appellant cannot be penalized for entertaining different opinion as the issue was being discussed and deliberated by various Benches of the Tribunals and the High Courts; moreover, the appellant himself could have availed the credit of service tax paid and therefore, the issue is revenue neutral. Therefore, extended period cannot be invoked. He relies on the following case in respect of all his arguments: 6. Shri S.K. Meena, learned Authorized Representative for the Department, reiterates the findings of the impugned order. He takes us through the provisions of the law and submits that as per terms of the contract/ agreement by the appellants with JVR Forgings, effective control is not given to the lessee and therefore, the arrangement is nothing but supply of tangible goods. He relies on Adani G....
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....the premises of lessee. Thus, out of the two conditions of Transfer of Right of Possession and Effective Control, the first one is not satisfied as the possession of the machinery has been given. Unless the two conditions are satisfied, the service cannot be said to be of supply of tangible goods. On this count alone, the Department's argument fails. The conditions regarding repair loss and damage in the above agreement are of general nature and do not indicate that the right of effective control is not transferred. Further, as the appellants paid applicable VAT on the deemed sale, one should not have a doubt about the right of possession being transferred. 9. Coming to the demand on Business Exhibition Services, we find that the expenses are related to the exhibition held outside India for which payment was made outside India to the organisers of the event. The service is provided and received outside India and therefore, the same are not exigible to service tax. Moreover, we find that the expenses related to purchase of material for display in exhibition and ocean freight incurred on this count came to be included in the Business Exhibition Services w.e.f 01.05.2011; the deman....
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....all, for the purposes of this section, be taxable service, and such taxable service shall be treated as if the recipient had himself provided the service in India, and accordingly all the provisions of this Chapter shall apply: Provided that where the recipient of the service is an individual and such service received by him is otherwise than for the purpose of use in any business or commerce, the provisions of this sub-section shall not apply: Provided further that where the provider of the service has his business establishment both in that country and elsewhere, the country, where the establishment of the provider of service directly concerned with the provision of service is located, shall be treated as the country from which the service is provided or to be provided. (2) Where a person is carrying on a business through a permanent establishment in India and through another permanent establishment in a country other than India, such permanent establishments shall be treated as separate persons for the purposes of this section. Explanation 1.- A person carrying on a business through a branch or agency in any country shall be treated as having a business establishment in that cou....