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Landmark Service Tax Judgment - Authorised Service Station Services

Taxable Services - Authorised Service Station Services

Case Laws Related

  • STO 2013 CESTAT 952
  • Authorised Service Station: Demand: Stay: From the evidences available on record, it is clear that the appellant has been functioning as an 'Authorized Service Station' of M/s Tata Motors and, therefore, the services rendered by the appellant is prima facie classifiable under the category of "Authorized Service Station": Directions issued for partial pre deposit.

  • STO 2011 CESTAT 275
  • Demand: Stay: Various services involved on which demand raised: Prima facie ground found on limitation ground: Pre-deposit waived.

  • STO 2010 CESTAT 25
  • Service Tax:  Authorised Service Station: Service Tax with interest paid before issue of SCN:  Since the respondents had paid the service tax along with applicable interest before issue of show cause notice and no fraud or willful intention on the part of the respondent was found by the authorities, in terms of provisions contained in Section 73(3) of the Act, no further proceedings were warranted. Further it had been clarified by the CBEC vide Circular No.F.No.137/167/2006-CX-4 dt. 3/10/2007, that in such cases, no show cause notice was to be issued.  The appeal filed by the Revenue is rejected as devoid of merits. (para 2)

  • STO 2010 CESTAT 20
  • Penalty: Authorised Service Station: The failure to pay Service Tax on the part of the respondents was occasioned by its ignorance of law on the liability and not due to intention to evade any payment of service tax. This finding has not been successfully challenged. In the circumstances, there is no case for imposing any penalty. Appeal filed by the Revenue is rejected.

  • STO 2009 CESTAT 412
  • Free service by Authorised Service Station: The provision of free servicing is merely incidental and intended to promote the sale of the cars. No service tax can be levied on the amount representing the dealers' margin or any part of it which already has been subjected to sales tax.

  • STO 2007 CESTAT 1431
  • Authorised Service Station: Input Service: The appellants are undertaking after-sales service in the authorized service station. ‘Input service’ includes activities relating to business. Therefore, it is required to be examined as to whether these services are related to the activities of business. Impugned orders are set aside and the matter is remanded back.

  • STO 2007 CESTAT 1028
  • Sales tax v/s service tax: The dealers’ margin which is recovered by the appellants as a part of the sale value of the cars from the customers and the entire amount subjected to sales tax by the concerned State Government authorities. When the appellants sold the cars and recovered the amount including the dealers’ margin, the dominant intent, was to sale the goods, namely, cars and not to provide free after sales service. The entire amount including the dealers’ margin has been rightly taxed to sales tax representing the value of the cars. The provision of free servicing is merely incidental and intended to promote the sale of the cars. Hence, no service tax can be levied on the amount representing the dealers’ margin or any part of it which already has been subjected to sales tax.

  • STO 2007 CESTAT 1030
  • Levy: Service tax not leviable for free services rendered by the authorized agency in respect of the cars sold by them.

  • STO 2007 CESTAT 450
  • Stay: Authorised Service Station: penalty: It is now well-settled that penalty is not leviable on mere venial breach. There has to be intention to evade payment of duty, facts of suppression, mala fide, etc. for levy of penalty. Waiver granted.

  • STO 2007 CESTAT 1137
  • Free Service : When no consideration is received for the services rendered, there cannot be any question of levying Service Tax.

  • STO 2007 CESTAT 697
  • Stay: Authorised Service Station: Divergent views expressed by Board in two different Circulars : Prima Facie Service tax on free services leviable.

  • STO 2007 CESTAT 294
  • Service Tax: Liability on "warranty labour charges" for the free services: The warranty labour charges are fixed by Maruti Udyog and form a part of Dealer's commission. It has been specifically mentioned by Maruti in their service circular that the warranty labour charges were paid to the dealers in advance i.e. with the dealer's commission. And, therefore, for the purpose of assessment of service tax of these free services do not remain free. In this regard, the appellant has contended that, the value of the services is zero, therefore, the service tax will also be zero. In this regard, I find that, the value of the service tax has been defined under Section 67 of the Finance Act, 1994, which reads as under: "for the purpose of this Chapter the value of any taxable service shall be the gross amount charged by the service provider of such service rendered by him". In view of the above definition, I find that, there is sufficient evidence on record to prove that the appellant has charged certain amount for the services, therefore, it is incorrect to say that the value of the services was zero. The said agreement clearly indicates the nexus between the manufacturer and the dealer in terms of free services during the warranty period. The authorized dealer draws commission from the manufacturer which obviously includes certain cost in terms of the three free services during the warranty period as elaborated in Article X of the said dealership agreement.(Para 1,4).

    Pre-deposit ordered.

  • STO 2007 CESTAT 166
  • Service Tax: Authorized service station: No prima facie case has been made out by the revenue in view of the finding of the lower appellate authority that handling charges are in relation to sale and not in relation to any services provided by the respondents and further, the revenue has not been able to show that the handling charges on which the Service tax has been demanded is in the nature of repair charges liable to Service tax.(Para 1).

    Appeal rejected.

  • STO 2006 CESTAT 150
  • Service Tax: Authorised service station: Demand on value of free service: Issue pertains to interpretation of the activity carried out by the appellants. The activity of authorized service station as subsequently been amended by Finance Act that if the free service is inbuilt in the sale consideration, then service tax is not leviable, and this benefit has been given to other service stations by Commissioner (Appeals) Cochin and Kannur. The Commissioner (Appeals) should have considered this plea. The appellants have a wrong case in their favour.(Para 3).

    Pre-deposit waived and stay allowed.

  • STO 2005 CESTAT 39
  • Consulting Engineer Service: Royalty and Know-how Payment: Revenue has not made out a clear case that the respondents have incurred certain expenditure for availing the services of a consulting engineer from their foreign collaborators. Whole agreement is based on what can be called as a transfer of know-how, involving royalty. While one cannot rule out the possibility of camouflaging certain component of services under the carpet of royalty, it is not the case here as neither the show cause notice issued nor the appeal petition filed by the Revenue alleges before us such a situation.





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