TaxTMI 
TaxTMI 
2026 (3) TMI 1640
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....entralised registration thereafter. Both the appellants filed the following Appeals against the impugned orders as shown below. Appellant-1[M/s Yatra Online Pvt Ltd] Appeal No. Period Date of SCN Date of Impugned order Duty/ Penalty Rs ST/6066 7/ 2018 2007-2011 07-06-2012 28-02-2018 98,32,33,992 38,18,44,782 2011-2012 27-12- 2012 2012-2013 19-05-2014 2013-2014 20-04- 2015 2014-2015 19-04- 2016 ST/6021 9/2019 2015-2017 28-03-2018 31-10-2018 12,93,47,660 1,29,34,766 Appellant-2 [M/s TSI Yatra Pvt Ltd] Appeal No. Period Date of SCN Date of Impugned order Duty/ Penalty Rs ST/6047 9/2017 2010-2012 18.10.2013 22.08.2016 5,22,16,086 2. Brief facts of the cases are that the appellants are engaged in the business of booking of air tickets for various domestic and international airlines. The operation module of the appellants is that the CRS / GDS companies share details of air tickets of airlines, through the platform systems developed by them showing fli....
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....ncentive was provided by the airlines, during the period August, 2007. Submissions on behalf of the appellant (i). Demand of service tax on 'Business Auxiliary Service' and 'Intermediary Service' 3. Shri Arjun Raghavendra, learned counsel for the appellants, submits on the first issue, i.e. demand of service tax on Business Auxiliary Service (period April 2007 to March 2014) and Intermediary Service (2014 to March 2016), alleged to have been rendered to the CRS/GDS companies, that despite the changeover to negative list regime in July 2012, demands continued to be issued under 'Business Auxiliary Service'; Commissioner relies on CBIC circular F. No. 334/8/2016-TRU dated 29.02.2016 and Tribunal's decision in the cases of M/s Govan Travels (2017-TIOL-3866-CESTAT-DEL) and D Paul's Consumer Benefit (Final order no. 50861/2017 2017-TIOL-908-CESTAT-DEL); commissioner queerly holds that the Noticee cannot claim relief in the name of alleged inconsistencies in the aforesaid Demand-cum-Show Cause Notice as the law clearly stipulates that the demand under Section 73(1) are made on the same grounds as mentioned in the earlier notices; though tax was demanded under 'Business Auxiliary....
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....d Counsel submits further that Hon'ble Madras High Court in the case of K. Ramulu v. Director of T.N. Raffle, Govt. Estate, 1972 SCC Online Mad 3 : (1973) 86 LW 535 (Mad) noted that the word "normally" when used in a rule accorded flexibility and relaxed rigid prescription; Hon'ble Supreme Court in the case of Chackolas Spinning and Weaving Mills Ltd 2015 (322) ELT 167 (SC), relying on the word "normally" in the Central Excise (Valuation) Rules, 1975, held that the taxable value is to be determined not based on the actual profit earned but the notional profit; this ratio of Hon'ble Supreme Court is squarely applicable in the instant case too where the rule specifically uses the word "normally"; there could be cases where commission is not at all paid or commission is paid on the base fare (in line with the normal practice) or commission is paid on base fare plus fuel surcharge; irrespective of whether commission was paid or not on each transaction, the Rule 6(7) requires that basic fare on which commission is normally paid is deemed to be the notional commission and tax needs to be paid accordingly. 4.2. Learned Counsel submits also that the Hon'ble Supreme Court in the matter o....
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....es' and 'rent-a-cab services' where abatement is available and 'air travel agent services', where abatement was not available; the appellant used common input services like advertisement services, business support services, telephone etc; it was not possible to exactly determine the component of such input services which went towards abatable and non-abatable taxable services; law provided a formula for proportionate reversal of common CENVAT credit between taxable and exempted services vide Rule 6 of the CENVAT Credit Rules, 2004 (CCR, 2004). 5.1. Learned Counsel submits further that the formula was introduced w.e.f.01.04.2011only; no such formula existed during the impugned period; when the amendments were carried out in 2011, the Joint Secretary (TRU-II) issued explanation vide D.O.F.No.334/3/2011-TRU dated the 28th February, 2011, with the stated objective to provide a practical scheme for the segregation of CENVAT credits used in respect of final products and output services where they are partially exempted with condition that no such credits shall be taken; it is thus, clear that before the amendment, a practical scheme was absent for such proportionate segregation of cre....
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.... the ratio - 𝑇𝑜𝑡𝑎𝑙 𝑣𝑎𝑙𝑢𝑒 𝑜𝑓 𝑒𝑥𝑒𝑚𝑝𝑡𝑒𝑑 𝑠𝑒𝑟𝑣𝑖𝑐𝑒𝑠 𝑇𝑜𝑡𝑎𝑙 𝑣𝑎𝑙𝑢𝑒 𝑜𝑓 𝑒𝑥𝑒𝑚𝑝𝑡𝑒𝑑 𝑠𝑒𝑟𝑣𝑖𝑐𝑒𝑠+𝑇𝑜𝑡𝑎𝑙 𝑣𝑎𝑙𝑢𝑒 𝑜𝑓 𝑛𝑜𝑛 𝑒𝑥𝑒𝑚𝑝𝑡𝑒𝑑 𝑠𝑒𝑟𝑣𝑖𝑐𝑒𝑠 In the instant case that would mean - 𝑇𝑜𝑡𝑎𝑙 𝑣𝑎𝑙𝑢𝑒 𝑜𝑓 𝑎𝑏𝑎𝑡𝑎𝑏𝑙𝑒 𝑠𝑒𝑟𝑣𝑖𝑐𝑒𝑠 𝑇𝑜𝑡𝑎𝑙 𝑣𝑎𝑙w....
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....ed Counsel submits that this position has also been accepted in the impugned order; therefore, proportionate reversal of credit amounting to credit not being taken, subject to correctness of the reversal, the conditions for availing the abatement notification are satisfied. He submits that the impugned order incorrectly holds that "Value" should be under section 67 without factoring in that "Value" is defined in Rule 6 of CCR 2004; as per explanation I, under Rule 6, "Value" for the purpose of sub-rules (3) and (3A), in the case of a taxable service, when the option available under sub-rules (7), (7B) or (7C) of rule 6 of the Service Tax Rules, 1994, or the Works Contract (Composition Scheme for payment of Service Tax) Rules, 2007 has been availed, shall be the value on which the rate of service tax under section 66 of the Finance Act, read with an exemption notification, if any, relating to such rate, when applied for calculation of service tax results in the same amount of tax as calculated under the option availed. 5.7. Learned Counsel submits that it is clear from the provisions that the "value" to be adopted is not the value under section 67 but a value in line with the ser....
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....om 2011-2014, is concerned; the reasoning given by commissioner is applicable only for the period from 2007-2011; after the formula for reversal was provided from 01.04.2011, the issue ceases to exist; in spite of the amendments, the said SCNs have been mechanically issued and demands have been confirmed without application of mind; the demand for a period after 01.04.2011 was confirmed without giving any findings or observations or reasoning. consequently, demand of Rs 56,31,25,899 (out of the total of Rs 76,09,05,400) on the said issue, being cryptic and non-speaking, passed without any reasoning, is liable to be set aside as held in Tata Engineering & Locomotive Co Ltd 2006 (203) ELT 360 (SC); Penguin Electronics (P) Ltd 2005 (185) ELT 194 (T); Man Structurals Ltd 2004 (166) ELT 376 (T) and Water Trading Corporation 2003 (160) ELT 323 (T). 5.10. Learned Counsel submits that on this issue, the demand raised vide SCN dated 07-06-2012 totally and demand raised vide SCN dated 27-12-2012 partially are barred by limitation; the information regarding output services on which benefit of abatement was availed and the input services on which credit was availed was in the knowledge of t....
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....). He submits that in a number of cases, it was held that the benefit of adjustment of excess payment of service tax cannot be denied on the grounds of procedural lapses such as non-filing of intimation, adjustment of an amount exceeding one lakh etc; he relies on ▪ General Manager (CMTS) 2014 (36) STR 1084 (Tri.-Del) ▪ L&T Sargent & Lundy Limited 2016 (43) STR 249 (Tri-Ahmd) ▪ Electrical Manufacturing Company Ltd 2017 (3) GSTL 196 (TriDelhi) ▪ Jubilant Organosys Ltd 2015 (38) STR 1230 (Tri-Del) ▪ Rajdeep Buildcon Pvt Ltd 2011 (21) STR 663 (Tri-Mumbai) Non-payment of service tax under RCM 7. Learned Counsel submits as far as the allegation of non-payment of service tax against certain services, viz Advertisement agency service, business support services, Online Information and Database Access or Retrieval Services, sponsorship services, Information Technology Software Services, Market Research Agency Services and Commercial Coaching or Training Services, received by the Appellant that the duty demanded was paid along with interest and there has been an error in appropriating the same properly; with res....
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....bmitted details to Audit conducted during March - April 2010; the details were again disclosed by the Appellant vide letter dated July 5, 2011; there is no suppression or willful misstatement. 8.2. Learned Counsel submits that the Appellant is eligible to claim CENVAT credit of service tax paid on such gateway charges as the same qualify as 'input service' as the Appellant used the gateway services provided by credit card companies for provision of air travel agent services to the customers; in terms of Rule 2(l) of the CENVAT Credit Rules, any service used by the provider of taxable service for providing an output service would qualify as 'input service'; in order to encourage the customers to make payment using credit cards, certain airlines initiated an incentive scheme; the incentive was in addition to the commission; as the input service is used by the provider of taxable service for provision of output service, they are eligible to avail the said credit. 8.3. Learned Counsel submits that CENVAT Credit Rules do not provide any restriction on the eligibility on input services where cost of such services is reimbursed by any third person; CENVAT Credit Rules do also not pr....
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....ess of those companies and as such the payments are clearly in the nature of consideration for promoting the business of the CRS/GDS companies; the amounts received by the appellant from the CRS/GDS companies represent consideration for promoting their business and thus fall squarely within the scope of Business Auxiliary Service as defined under Section 65(105)(zzb) of the Finance Act, 1994. He relies on M/s Govan Travels (2017-TIOL-3866-CESTAT-DEL) and D Pauls Consumer Benefit Ltd, (Final Order No. 50861/2017; 2017-TIOL-908-CESTAT-DEL). Fuel Surcharge is includible in the "Basic Fare" under Rule 6(7) 11. Learned Special Counsel submits that as per the provisions of Rule 6(7) basic fare" means the fare on which commission is normally paid by each airline to the agent; statutory scheme makes it clear that air travel agent service becomes taxable on the commission received by the agent; Rule 6(7) merely provides an optional, simplified method of paying tax on a percentage of the basic fare; the appellant has conceded that several airlines had indeed paid them commission on fuel surcharge, as a normal and routine practice; once the appellant has received commission from an airl....
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....tement; the appellant was never eligible for abatement under Notification No. 1/2006-ST, and the demand raised on this ground has been rightly confirmed along with interest. Adjustment of Excess Service Tax under Rule 6(4A)/(4B) 13. Learned Special Counsel submits that the appellant has short-paid service tax by making unauthorised adjustments of excess tax allegedly paid in previous months; appellant adjusted amounts paid in excess during June-August 2007 and October 2007 against its service tax liability for September 2007, November 2007, December 2007, and March 2008; Rule 6(4A) of the Service Tax Rules, 1994 permits adjustment of excess payments, subject to the conditions laid down in Rule 6(4B); these conditions are mandatory and include that * excess payment must not arise from issues involving interpretation of law, taxability, valuation or applicability of exemptions; * except in cases of delayed receipt of details under Rule 4(2), adjustments are capped at Rs.1 lakh per month or quarter; * the assessee must intimate the jurisdictional Superintendent within fifteen days of making such adjustment. 13. Learned Special Counsel submits that i....
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....he case. The issues involved in this case are in a narrow compass. Revenue has issued periodical Show Cause Notices to the appellants alleging that they are liable to pay Service Tax on some issues and are not eligible to avail Cenvat Credit under some heads. The allegations of the Revenue are that (i). The appellants are liable to pay applicable Service Tax on CRS/GDS Incentives received by the appellant under 'Business Auxiliary Service'. (ii). Fuel Surcharge is includible in the "Basic Fare" under Rule 6(7) for the purposes of payment of Service Tax. (iii). Abatement claimed by the appellants under Notification 1/2006-ST is not available to them as they availed Cenvat Credit on input Services etc; (iv). Adjustment of Excess Service Tax made by the appellants themselves under Rule 6(4A)/(4B) is not permissible. (v). CENVAT Credit is not available on Gateway Charges reimbursed by some airlines. (vi). Appellants failed to discharge Service Tax on some items under Reverse Charge Mechanism. 15.1. Revenue also alleges that the extended period is invocable in some Show Cause Notices. Demands confirmed vide impugned orders under n....
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....el agents, while that of the Department is that the travel agents promote the services of the CRS Companies. 60. It is seen that the CRS commission is paid to a travel agent if he is able to attain an agreed level of segments to be booked. A passenger is not aware of the CRS Company being utilized by the travel agent for booking the segment nor can a passenger influence a travel agent to avail the services of a particular CRS Company. What is important to notice is that for an activity to qualify as "promotional", the person before whom the promotional activity is undertaken should be able to use the services. The passenger cannot directly use the CRS software provided by the Company to book an airline ticket. It cannot, therefore, be said that a travel agent is promoting any activity before the passenger. 61. The matter can be examined from another aspect. For booking a ticket, a travel agent would require a system to book the tickets. A travel agent is free to choose any CRS system. A passenger would never request a travel agent to book his ticket only through Amadeus/Galileo/Abacus system. Can it, therefore, be said that the travel agent is engaged in the promo....
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....ce service to the insurance Company. As both the insurance Company and reinsurer pay service tax on the entire amount of premium charged by them, the question of charging service tax under any other taxable service does not arise." (emphasis supplied) 63. It is seen from the aforesaid Circular that the commission deducted by the insurance Company was being subjected to tax alleging that the insurance Company was providing BAS to the reinsurance Company by promoting the business of the reinsurance Company. The Board clarified that such an arrangement between the insurance Company and the reinsurer Company was for sharing of expenses only and no BAS was rendered as the customer of the insurance Company was only unaware of the role of the reinsurer. The Circular, therefore, reinforces that if the audience of an alleged promotional service is unaware of the service of the client, no "promotional or marketing services" can be said to have been provided. 64. Learned Authorized Representative of the Department, however, submitted that the promotion of "reservation functionality" of a particular CRS Company is not an activity which is connected to the booking of ....
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....ll be preferred to sub-clauses providing a more general description; (b) composite services consisting of a combination of different services which cannot be classified in the manner specified in clause (a), shall be classified as if they consisted of a service which gives them their essential character, in so far as this criterion is applicable; (c) when a service cannot be classified in the manner specified in clause (a) or clause (b), it shall be classified under the subclause which occurs first among the sub-clauses which equally merits consideration." (emphasis supplied) 70. The two competing entries are "air travel agent" service and "BAS". It would be seen from the definition of "air travel agent" that it includes all services connected with or in relation to the booking of passage for travel by air. The services in question are booking of airlines tickets and for achieving a pre-determined target, the air travel agent also receives an additional amount in the form of incentives/commission from the airlines or the CRS Companies. The receipt of incentives/commission would not change the nature of the services rendered by the travel agent. ....
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....luation of taxable services for charging service tax. Sub-section (1) of Section 67 provides that where service tax is chargeable on any taxable service with reference to its value, then such value shall, where the provision of service is for a consideration in money, be the gross amount charged by the service provider for such service provided or to be provided by the service provider. It is, therefore, clear that only such amount is subject to service tax which represents consideration for provision of service and any other amount which is not a consideration for provision of service cannot be subjected to service tax. 76. In this connection, it would be appropriate to refer to the decision of the Supreme Court in Union of India v. Intercontinental Consultancy and Technocrats [2018 (10) G.S.T.L. 401 (S.C.)]. The Supreme Court observed that service tax is on the "value of taxable services" and, therefore, it is the value of the services which are actually rendered which has to be ascertained for the purpose of calculating the service tax. It is for this reason that the expression "such" occurring in Section 67 of the Act assumes importance. The Supreme Court, therefore, o....
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.... I06. The last remaining payment type is Ford's retail target incentive payment. It is clear from the "Drive for Success" program that the payment is triggered at the time, and by reason, of the Applicant's recording of a level of new sales for a relevant period of eligible vehicles to eligible customers in excess of a specified target set by Ford. Significantly, though, and unlike the fleet rebates and the run-out model support payments, the target incentive payment has no nexus with any one particular supply. It is a payment made in connection with supplies generally, or perhaps more accurately, it is a payment made in connection with the making of supplies generally. 53. On analysis, the so-called supplies for consideration identified by the Commissioner are nothing more than the encouragement of an overall business relationship between the manufacture and the dealer to the mutual benefit of both. The relationship involves a whole raft of obligation from one to the other all, presumably, with the ultimate objective of maximizing their respective commercial positions. As the AP Group put it, the overall relationship contemplates a continuing dialogue between ....
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....refore, be treated as consideration for any service. The incentives received by the appellant cannot, therefore, be leviable to service tax. (emphasis supplied) 80. It, therefore, clearly transpires from the aforesaid decisions that incentives paid for achieving targets cannot termed as "consideration" and, therefore, are not leviable to service tax under Section 67 of the Finance Act. 81. The reference to this Larger Bench has arisen for the reason that the Division Bench hearing this appeal expressed doubts about the view taken by the Division Bench in D. Pauls. The appellant therein was a travel agent who had used the CRS system of Galileo, Amadeus and Abacus which had paid incentives to the appellant for the period from October 1, 2003 to December 21, 2008. The lower authorities had observed that the services provided by the appellant fell under the category of "tour operator" services as defined under Section 65(11)(o) of the Finance Act. In the appeal before the Tribunal, the Learned Authorized Representative of the Department had submitted that the services were covered under "BAS". The Division Bench hearing the appeal observed that the services provide....
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....ssessee-appellants is not applicable in the instant case as the same was dealing with the advertising agencies. So, on the facts, the ratio laid down in the said case is not applicable to the present case is not applicable to the present case." (emphasis supplied) 82. A perusal of the aforesaid decision would indicate that though in paragraph 2 of the decision, the Division Bench noted that the lower authorities had categorized the services rendered by the appellant as "tour operator", but in paragraph 5 of the decision the Division Bench observed that the services provided by the appellant were rightly covered under "BAS". In fact, the Division Bench also observed that since the appellant was providing "tour operator" services, the commission received by them is for "BAS" under Section 73(1) of the Finance Act. There is no discussion in the decision as to why the commission received would fall under "BAS". The decision also does not specify the particular sub-clause of Section 65(19) of the Finance Act that defines ""BAS". It also needs to be noted that on behalf of the appellant it was contented that no marketing or promotion was conducted by the appellant since it is....
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....ppellant has chosen to pay Service Tax in terms of Rule 6 (7) ibid. and therefore, tax cannot be demanded by applying the provisions of Section 67 ibid. Hence, the ratio in M/s. Japan Airlines International Company Ltd. (supra) is not applicable. 9. An airline may pay commission inter alia on various items, apart from the basic fare, which are indicated clearly in the ticket issued to a traveller. The basic fare is clearly indicated, followed by various other charges in such ticket. Hence, in our view, when the basic fare is so specifically indicated, the authorities cannot add or delete anything to the same to say that the basic fare should also include those other things. 9.2 Rule 6 (7) has to be read, therefore, in the context of the break-ups given in the ticket wherein the basic fare stands clearly indicated and viewed thus, the interpretation drawn by the lower authorities to include the commission on fuel surcharge in the basic fare cannot hold any water, for which reason the impugned order cannot sustain. 18.1. In view of the above, we find that the issue is no longer res integra and the issue is fairly decided in favour of both the appellants. The dema....
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....ime; the output services on which abatement was availed were disclosed in the ST-3 returns; therefore, there is no wilful suppression by the Appellant; Tribunal, in a case, of Arya Logistics (2023) 12 Centax 309 (Tri-Ahmd), with a similar denial of benefit under abatement under Notification No. 01/2006-ST, held that extended period cannot be invoked since all facts were before the department; thus, demand to the tune of Rs 25,61,58,672 is liable to be set aside. 19.3. We find that in the impugned case, the initial Show Cause Notice Dated 07.06.2012 seeks to deny the abatement on the grounds that the formula adopted by the appellants is incorrect. The Show Cause Notice alleges as below. 5.3 However, the assessee contended that though they were discharging the service tax liability after availing the benefit of abatement under the Notification No. 1/2006-ST dated 01.03.2006, they were not availing 100% CENVAT Credjt of Service tax paid on common input services, instead they were availing CENVAT credit on proportionate basis, attributable to input services used in relation to provision of non-abated services; that even in cases where taxable and exempted services were prov....
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....ersed the proportionate cenvat credit availed by them in respect of common input services used for abated services. I notice that the I find that in para 5.4 of the impugned show cause notice, it has been alleged that the formula adopted by the noticee for working out cenvat credit attributable to tour operator service/rent-a-cab service and to air travel agent service is in the ratio of gross value of tour operator service/rent-cab service to basic fare of air tickets under air travel Agent Service. It has been alleged that the formula adopted by the Noticee does not appear to be correct due to following reasons: (i) The option for discharge of service tax liability provided under Rule 6(7) of the Service Tax Rules, 1994 is alternate method and rate specified under Section 66 of the Finance Act, 1994 is not applicable. (ii) The measure of value for determining tax liability in respect of 'Air Travel Agent Service' is commission received from the airlines i.e. the value in terms of Section 67 of the Finance Act, 1994 is amount of commission received from airlines, and not the gross amount of basic fare of air tickets. 132.3.6 I notice that the not....
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....nvat credit to suit their interest and based on wrong facts, is grossly in violation of the Law and Rules in force at the time and cannot be considered as satisfaction of the conditions for availment of the benefit of the said Notification. Hence, the demand on this account is liable to be confirmed along with interest. 19.5. We find that w.e.f. 01.04.2011, the formula prescribed for proportionate reversal of credit availed on common inputs is as per the following ratio - 𝑇𝑜𝑡𝑎𝑙 𝑣𝑎𝑙𝑢𝑒 𝑜𝑓 𝑒𝑥𝑒𝑚𝑝𝑡𝑒𝑑 𝑠𝑒𝑟𝑣𝑖𝑐𝑒𝑠 𝑇𝑜𝑡𝑎𝑙 𝑣𝑎𝑙𝑢𝑒 𝑜𝑓 𝑒𝑥𝑒𝑚𝑝𝑡𝑒𝑑 𝑠𝑒𝑟𝑣𝑖𝑐𝑒𝑠+𝑇𝑜𝑡𝑎𝑙 𝑣𝑎𝑙𝑢𝑒 𝑜𝑓 𝑛𝑜𝑛 𝑒𝑥𝑒𝑚𝑝𝑡⻕....
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....e 6(7) of CCR, 2004 shows that the legislative intent was to allow for the alternate values available to the taxpayer for payment of tax under the Service Tax Rules 1994 and not necessarily restrict the value to only section 67 of the Act. Therefore, the "value" as calculated by the Appellant-1 is not wrong as held in the impugned order. 19.7. We find that the learned adjudicating authority begins his findings by observing that the judicial pronouncement on the issue indicate that CENVAT credit reversed would amount to non-availment of CENVAT credit and the appellants are eligible for the abatement in terms of the Notification as they have reversed a proportionate CENVAT credit. Thereafter, he goes on to find that the formula, adopted by the appellants, is not correct and that the formula adopted is a homegrown self-invented formula by the appellants, conveniently ignoring the fact that there was no formula prescribed under relevant rules before 01.04.2011. Having held that reversal amounts to non-availment of CENVAT credit, learned adjudicating authority does not even bother to verify whether the formula adopted by the appellants was correct and proportionate reversal was made ....
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....2011, learned commissioner fails to appreciate that there was no formula prescribed and for the period after 01.04.2011, he ignores the fact that a formula has been prescribed and the Rule 6(7) allows taking, for the purposes of the formula, the value on which the appellant chooses to pay duty. It appears that the adjudicating authority gives sufficient scope to conclude that the impugned order is cryptic, non-speaking, vague and beyond the scope of the SCN. We find that as per the cases relied upon by the appellants, the order cannot be sustained. 19.9. We find that Hon'ble High Court of Gujarat, in the case of Sitaram Roadways (URP) 2020 (33) G.S.T.L. 174 (Guj.), held that: 16. At this juncture reference may be made to the decision of the Supreme Court in Kranti Associates (P) Ltd. v. Masood Ahmed Khan, (2010) 9 SCC 496 = 2011 (273) E.L.T. 345 (S.C.) wherein the Court in the context of necessity to give reasons, has held thus : "47. Summarising the above discussion, this Court holds : (a) In India the judicial trend has always been to record reasons, even in administrative decisions, if such decisions affect anyone prejudicially. (b) A quasi....
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....easons emanates from the broad doctrine of fairness in decision-making, the said requirement is now virtually a component of human rights and was considered part of Strasbourg Jurisprudence. See Ruiz Torija v. Spain, (1994) 19 EHRR 553 and Anya v. University of Oxford, 2001 EWCA Civ 405 (CA), wherein the Court referred to Article 6 of the European Convention of Human Rights which requires, "adequate and intelligent reasons must be given for judicial decisions". (o) In all common law jurisdictions judgments play a vital role in setting up precedents for the future. Therefore, for development of law, requirement of giving reasons for the decision is of the essence and is virtually a part of "due process"." 17. In CCT v. Shukla & Bros., (2010) 4 SCO 785 = 2011 (22) S.T.R. 105 (S.C.) = 2010 (254) E.L.T. 6 (S.C.) the Supreme Court held thus : "14. The principle of natural justice has twin ingredients; firstly, the person who is likely to be adversely affected by the action of the authorities should be given notice to show cause thereof and granted an opportunity of hearing and secondly, the orders so passed by the authorities should give reason for arriving at....
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....for the order made, in other words, a speaking out. 20. Thus, the Supreme Court has consistently held that a quasi-judicial authority must record reasons in support of its conclusions and that reasons are an indispensable component of a decision making process. In CCT v. Shukla & Bros. (supra) the Supreme Court has held that giving reasons in support of the conclusions arrived at is an ingredient of the principles of natural justice. 21. Viewed in the light of the principles enunciated in the decisions referred to hereinabove, the impugned order is in breach of the principles of natural justice on two counts : firstly, that though the matter was kept for hearing on 28-8-2019, the second respondent passed the impugned order on 24-8-2019 without affording any opportunity of hearing to the petitioner; and secondly, because the impugned order is a totally nonspeaking order which does not reflect the reason as to why the proper officer has come to the conclusion that the goods and the conveyance are liable to be confiscated, which renders the order unsustainable. The impugned order, therefore, deserves to be set aside and the matter is required to be remitted to the pr....
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....versal was never a proposition either in the show cause notice or in the impugned order, which always harped on the presumption that the formula adopted by the appellants was homegrown, self-invented and incorrect. Revenue has never alleged that the calculations were incorrect and the quantification needs to be done properly. Under the circumstances, we find that it will not be justified to remand the matter back to the adjudicating authority as the quantification of the credit reversed was never disputed. We find that the department failed to establish that the appellants failed to fulfil the conditions required to avail the benefit under abatement notification 01/2006-ST dated 01.03.2006. Therefore, we find that the appellants are eligible for the said abatement and accordingly, the impugned order is not sustainable on this count. Further, the appellants submit that they have kept the department informed of all facts in time and therefore, in view of the decision of Ahmedabad bench of the Tribunal in the case of Arya Logistics (2023) 12 Centax 309 (Tri.-Ahmd), involving similar facts, that extended period cannot be invoked since all facts were before the department; demand of Rs ....
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....nt for certain services to be provided and had paid the service tax on it, but for some reasons, he could not provide the services wholly or partly and according to this rule, the assessee can adjust the excess payment of service tax calculated on pro rata basis against his service tax liability for subsequent period if he has refunded the value of taxable service along with service tax to the person from whom it was received. Thus, the sub-rule (3) provides for limited facility of adjustment in the cases where the amount has already been received by an assessee for the service to be provided and tax leviable thereon had been paid, but subsequently, due to some reasons, the service was not provided either in full or in part. Sub-rule (4) of the Rule 6 provides for provisional assessment, in the case where the assessee for any reason is unable to correctly estimate on the date of deposit, the actual amount payable for a particular month or a quarter, as the case may be, and according to this rule, he may request the jurisdictional Asstt./Dy. Commissioner for payment of service tax on provisional basis. Sub-rule (4A) provides that notwithstanding anything contained in sub-rule (4), w....
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....10 lakh paid is like an advance payment of tax whose incidence has not been passed on to his customers. In fact, w.e.f. 1-3-2008, sub-rule (1A) of Rule 6 has been introduced by Notification No. 4/2008-S.T., dated 1-32008 which also provides that without prejudice to the provisions of sub-rule (1) of Rule 6, every person liable to pay service tax may, on his own, pay an amount as service tax in advance to the credit of Central Government and adjust the amount so paid against service tax liability, which he is liable to pay in subsequent period, subject to the condition that he intimates the details of the amount paid in advance to the Jurisdictional Superintendent of Central Excise. The excess payment referred to in sub-rule (4A), read with sub-rule (4B), is like advance payment under sub-rule (1A) of Rule 6. There is no condition in Rule 6(4A) read with Rule 6(4B) providing that for availing of the adjustment facility, the assessee must have opted for centralized registration under Rule 4(2). Moreover, when an assessee during certain months, for reasons other than interpretation of law, taxability, classification, valuation or applicability of exemption, has paid service tax in exc....
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....redit. We find that the appellants submit that in terms of the Cenvat Credit Rules, Credit can be availed if the said service is an input service for the provision of output service; there is no restriction that there should be a value addition and that credit is not admissible when the charges paid are reimbursed. 21.1. We find that the Learned adjudicating authority observes as under 132.5.4 I find from the charges levelled in the impugned show cause notices that the noticee is incurring the expenditure on account of gateway services and getting the reimbursement from the airlines. Since the option for acceptance of payment by the noticee appears to be at the behest of concerned airline & the expenses are reimbursed, the gateway service (Banking & Financial service) provided in this case does not appear to be an input service, inasmuch as there is no value addition on this account to the taxable service provided by the noticee. I find that the said service was not used by the noticee for providing output service as the expenses on account of gateway charges are not part of the output services provided by them and therefore, it cannot be said that the services for whic....
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.... (i). Booking of accommodation for facilitating touring clients of the Appellant in foreign destinations (ii). Provision of right to participate in Business Exhibitions held abroad and Reimbursement of expenses to UK Marketing. The appellants submit that demand on first two items cannot be sustained as they were performed outside India; in terms of Rule 3(ii) of Taxation of Services (Provided from Outside India and Received in India) Rules, 2006, these activities are taxable only if they are performed in India; the third item is not a service but mere reimbursement of expenses and no service has been identified at all. The demands have been confirmed in this case without providing any reason as to why such a liability falls on the Appellant; demand deserves to be set aside on the ground that the order is not a speaking one. 22.2. We find that Tribunal in the case of Sarup Industries Ltd 2016 (41) S.T.R. 84 (Tri. -Del) held that: 2. We have considered the contention of the appellant. It is seen that the exhibitions were held abroad and therefore the service was rendered abroad and therefore prima facie there is no import of service requiring payment ....