TaxTMI 
TaxTMI 
2024 (8) TMI 1741
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.... the impugned order, Commissioner (Appeals) has held as follows:- "Section 65B(44) of the Act which specifically provides that it does not include transactions only in money or actionable claim. 6.3 In coming to the conclusion, I find that the following circulars issued by the CBEC and also the following decisions of various Courts Tribunals on the issue of service tax on recovery of damages, penal charges etc. are relevant here :- (a) Vide Circular No. 121/2/2010-S.T., dated 26/04/2010 (F. No. 332/29/2009- TRU), the CBEC has clarified that container detention charges not liable to Service Tax; (b) Vide Master Circular No. 96/7/2007-S.T., dated 23/08/2007 (F. No. 354/28/2007-TRU), the CBEC has clarified t....
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.... in the first pages of the copies of ST-3s submitted by the appellant for verification and therefore, question of imposition of any late fine under Section 70 of the Finance Act 1994 read-with Rule 7C of the Service Tax Rules 1994 does not arise. 8. Accordingly, I hold that the appellant is not required to pay service tax on 'penalties/liquidated damages' recovered by him and therefore, the demand of service tax with interest on this score and imposition of fine/penalties under sections 70, 77 and 78 of the Finance Act 1944 are not sustainable and the impugned order is liable to be set aside. 9. In view of the above discussions and findings, the impugned Order-in-Original Nos. 07/Addl. Comm./Appeal/Noida/2018-19 da....
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....ention of Provisions of Section 658 (44), 66E and 69 of the Finance Act, 1994 read with Rule 4 of Service Tax Rules, 1994. e. Penalty should not be imposed upon them under Section 78 of the Finance Act 1994 for contravention of Section 68 of the Act read with Rules 6 of Service Tax Rules, 1994 for their act of wilful suppression of taxable value of service to evade payment of correct Service Tax, as mentioned in the preceding paras." 2.3 This show cause notice was adjudicated as per the Order-in-Original dated 20.04.2018 by holding as follows:- "ORDER 1. I hereby confirm he demand Rs.1,97,95,096/- (Rupees One Crores, Ninety Seven Lakhs, Ninety Five Thousand and Ninety Six only) under Section 73(1) of the Finance Act,....
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....ircular's and also the decisions to arrive at the finding. 4.3 We also note that the issue in this case is no longer resintegra and decided by the decision of Delhi Bench in the case of RAJCOMP INFO SERVICES LTD. [2023 (73) G.S.T.L. 237 (Tri. - Del.)] observing as follows: "10. The next issue to decide is whether the appellant is liable to pay service tax on the amount deducted from the payment of various service providers/vendors in the name of liquidated damages for violating terms of agreement entered into. 11. It is seen that this issue was examined at length by the Division Bench of the Tribunal in M/s. South Eastern Coalfields Ltd. (supra) and the observations are as follows : It is trite that an agreement has to ....
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....t and suffer a loss. The purpose of imposing compensation or penalty is to ensure that the defaulting act is not undertaken or repeated and the same cannot be said to be towards toleration of the defaulting party. The expectation of the appellant is that the other party complies with the terms of the contract and a penalty is imposed only if there is noncompliance. The situation would have been different if 29. the party purchasing coal had an option to purchase coal from "A" or from "B" and if in such a situation "A" and "B" enter into an agreement that "A" would not supply coal to the appellant provided "B" paid some amount to it, then in such a case, it can be said that the activity may result in a deemed service contem....