TaxTMI 
TaxTMI 
2025 (4) TMI 2041
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.... registered stock broker and engaged in stock broking services. Appellant is also rendering services in commodities derivative trading for various persons acting through it. In addition to that appellant is also a SEBI registered Depository Participant (DP). On scrutiny of the account maintained by the appellant, audit observed that during the period from 2003-2004 to 2007-2008, appellant had collected transaction charges from their clients for which no service tax was paid. It is also observed that the appellant was collecting an amount of Rs.200/- to Rs.300/- per year as account maintenance charges for depository service from each client for keeping the account of the transactions in demat form with the support of depositories like NSDL and CSDL for which no service tax was paid. The services rendered by the appellant are subjected to levy of service tax by virtue of provisions of section 65(101) r/w Section 65(105) (a) of the Finance Act, 1994. Based on these observations, proceedings were initiated and Adjudication Authority as per the impugned order confirmed the demand of Rs.40,24,646/- for the failure of the appellant to pay service tax on the amount collected by them from t....
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.....06.2014 ST/23667/2014 01.04.2008 tο 31.03.2009 2,97,222 20.07.2009 4. Since the issues involved are common all the 8(eight) appeals they are being disposed by this common order. 5. Learned Counsel for the appellant further submits that stockbroking service is distinct and different from the service of a 'Depository Participant (DP)'. Registration with SEBI as a stock-broker does not make a person holding such registration entitled or eligible to act as a Depository Participant (DP). In other words, a DP need not be a stock broker or a stock broker need not be a DP. A person is registered as a stock broker to act as such under a specific exchange (NSE or BSE) while a DP is a person registered to act as such under a Depository (NSDL or CDSL). Therefore, it is submitted that activity of a DP is different from stockbroking activity. It is also submitted that that the service rendered by a stock-broker is that of enabling a person to buy or sell securities through the stock exchange and the services rendered by or the activity of a DP is to enable a person to keep the securities bought in a DP account opened in....
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....collect the said charges levied by the exchanges also from the clients concerned as it relates to the trades done by them. But, service tax was, however, collected only on the actual brokerage charged i.e., without including the transaction charges because such charges levied by the exchanges are not for any services rendered by the appellant in its capacity as a member of the exchanges concerned. 8. As regards service charge on reimbursable expenses, learned counsel further submits that the issue is settled as per the judgement of the Hon'ble High Court of Delhi in the matter of Intercontinental Consultants & Technocrats Pvt. Ltd., Vs. Union of India [2013 (29) S.T.R. 9 (Del)]. Learned Counsel also relied on the following judgments:- (i) Saurin Investments Pvt. Ltd., Vs. Commissioner of Service Tax, Ahmedabad [2009 (16) S.T.R 446 (Tri. Ahmd.)] (ii) LSE Securities Ltd., Vs. Commissioner of C.Ex., Ludhiana [2013 (29) S.T.R. 591 (Tri. - Del.)] (iii) M/s. Consortium Securities Pvt. Ltd., Vs. Commissioner of Service Tax, New Delhi [2017-TIOL-232-CESTAT-DEL] (iv) Indses Securities and Finance Ltd. & Span Caplease Pvt. Ltd. and Others Vs. C.S.T - Se....
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.... vide Final Order No. 76854/2018 dated 26.10.2018 it is held that gross amount charged by the appellant including handling charges has to be considered for payment of service tax. Thus, the Adjudication Authority has rightly confirmed the demand. 12. Heard both sides and perused the records. 13. The issue in the present appeals is whether the appellant, who is carrying the activity of stock broker/commodity broker/ Depository Participant is required to include NSE/BSE transaction charges, SEBI turnover fees, Stamp duty, Depository/DEMAT charges, Band-width charges and Security Transaction charges, which are recovered from their customers/clients separately and in accordance with regulations of various statutory bodies and not retained by the appellants but deposited with the authorities concerned, in the value of brokerage and commission charges. The issue was considered by the Tribunal in catena of cases and issue is also covered by the decision of this Tribunal in the matter of Manipal Universal Learning Pvt. Ltd. (supra) where this Tribunal after following the decision of the coordinate Bench of the Tribunal in the case of IMA Mental Arithmetic Academy Pvt. Ltd. Vs. CST, 2....
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.... Rules runs counter and is repugnant to Sections 66 and 67 of the Act and to that extent it is ultra vires. It purports to tax not what is due from the service provider under the charging Section, but it seeks to extract something more from him by including in the valuation of the taxable service the other expenditure and costs which are incurred by the service provider "in the course of providing taxable service". What is brought to charge under the relevant Sections is only the consideration for the taxable service. By including the expenditure and costs, Rule 5(1) goes far beyond the charging provisions and cannot be upheld. It is no answer to say that under sub-section (4) of Section 94 of the Act, every rule framed by the Central Government shall be laid before each House of Parliament and that the House has the power to modify the rule. As pointed out by the Supreme Court in Hukam Chand v. Union of India, AIR 1972 SC 2427 :- "The fact that the rules framed under the Act have to be laid before each House of Parliament would not confer validity on a rule if it is made not in conformity with Section 40 of the Act." Thus Section 94(4) does not add any greater fo....