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Landmark Service Tax Judgment - Management or Business Consultant Services

Taxable Services - Management or Business Consultant Services

Case Laws Related

  • STO 2013 CESTAT 1305
  • Management Consultancy Service: Issue whether the service of this type is one of "Man-power Supply Service" or "Information Technology Service" needs examination with reference to each of the contracts: 20 such contracts involved: Preliminary scrutiny reveals both types of contracts, in one type the receiver of service were organisations like batiks which hire services of others to develop software or certain modifications software and the agreement specified tasks for development of software and the billing also was in terms of the completed part of the development project, the other type agreements suggest that the service provided is of "Man-power Supply" service, which is evident from bills raised on man-month basis and also from the fact that the receiver of service was also a software developer which would imply that the applicant could not have been developing the software: Directions issued for partial pre deposit.

  • STO 2013 CESTAT 1006
  • Management Consultancy Service: Appellants looked after administrative and sales function of M/ s SSAL. Since the latter did not have any office in India of their own, for rendering the administrative and sale functions, the appellant shared the cost incurred as per the rates agreed upon between the two. From this, it is evident that the appellant was actually undertaking the administrative and sales functions. There is no evidence adduced by the Revenue to show that the appellant has rendered Management Consultancy Services to M/s SSAL

  • STO 2013 CESTAT 641
  • Management Consultant Service: Appellant actually managing the operations of the SCPL by employing their own staff. There is a difference between "manager" and "managing consultant". While manager actually manages the things, a consultant provides consultancy/advice as to how to manage. Both are not the same: Reasoning adopted by the lower appellate authority in the impugned order for coming to the conclusion that recipient did not render any management consultancy services cannot be faulted: Departmental appeal rejected.

  • STO 2013 CESTAT 601
  • Management Consultancy Services: Foreign entity was required to supply know-how to the appellant for manufacture of plastic resins in India: Supply of technical know-how for manufacture of goods in India does not mean upgradation or modification of any working system of any organisation and, therefore, does not fall within the scope of the service.

  • STO 2013 CESTAT 291
  • Management Consultancy Service: Demand: Principles of natural justice have been clearly violated as the primary requirement is to put the appellant to notice under what taxable service category, he is liable to service tax.

  • STO 2013 CESTAT 347
  • Demand: Stay: Real Consultant Service: Petitioner collects administrative charges/transfer charges/restoration charges from its customers/clients for substitution of the names of the transferees in their records, whenever customers/clients seek substitution of some other person's name instead of themselves in records of the petitioner/assessee: Services not covered under this service: Pre deposit waived.

  • STO 2013 CESTAT 491
  • Management Consultant Service: Transfer of technical know how not covered: Limitation: Date of providing service relevant and not the date of receipt of payment: Directions issued for partial pre deposit.

  • STO 2013 CESTAT 321
  • Management Consultancy Service: Business Auxiliary Service: Agreement showed that it was for rendering executor services and for sharing of the cost towards the same. Nothing in the said agreement relates or refers to management consultancy services to be rendered by the appellant to M/s BWIL. There is also no evidence led by the Revenue to show that the appellant gave consultancy to M/s BWIL in various field of management: Demand set aside.

  • STO 2013 CESTAT 64
  • Management Consultancy Service: Applicant is sending remittances abroad to their branch office as per the guidelines issued by the Reserve Bank of India. Contention that persons working in overseas branches are their employees and they are sending remuneration for running the establishment at the foreign branches: Applicant is having a centralized registration in Mumbai and they have paid an amount of Rs. 15,50,770/- on the Royalty charges paid to overseas service providers: Pre deposit waived.

  • STO 2012 CESTAT 1097
  • Management Consultancy Service: Demand: Stay: Reimbursible expenses: Rule 5 of STR, 1994 held as ultra vires of Section 66 & 67 of the Finance Act, 1994 by the Delhi High Court : Prima facie case made out for waiver from pre deposit.

  • STO 2012 CESTAT 1116
  • Management Consultancy Service: feasibility study of highway projects or study of excise duty structure of the textile sector or business valuation and re-valuation of assets etc. do not come under the category of developing or upgrading any working system in any organization not covered under MCS: Stay granted.

  • STO 2012 CESTAT 975
  • Management Consultancy Service: Service relating to assistance in complying with the laws of the Country not covered as it is executory in nature, whereas, the definition covers only consultancy part.

  • STO 2012 CESTAT 782
  • Management Consultancy Service: Liasion Work : the inclusive portion of a definition can not restrict the meaning of the "means part" of the definition which defines the general meaning: Liasion work neither in the nature of consultancy or advice.

  • STO 2012 CESTAT 697
  • Management Consultant Service: Departmental appeal: Commissioner (A) correctly examined all the activities and found these were not falling under any taxable category: Appeal rejected. 

  • STO 2012 CESTAT 473
  • Management Consultancy Service: It does not cover mere compliance activities.

  • STO 2012 CESTAT 321
  • Management Consultancy Service: Public Relations Service: Service specifically covered from 1.6.2005, therefore, service tax for earlier period cannot be demanded by invoking larger period: Stay granted.

  • STO 2012 CESTAT 176
  • Classification: Financial advisory and consulting services in relation to acquisition of business, assets or securities by way of a merger or consolidation, reorganisation, recapitalisation or restructuring etc classified as Management Consultancy Service.

  • STO 2011 CESTAT 156
  • Service Tax: Management or Business Consultant Services: Classification: Appeal: The impugned order, whereby the assessee's appeal was rejected for want of pre-deposit on the one hand and was also rejected on merits on the other, cannot be sustained in law. The impugned order is set aside and direct the Commissioner (Appeals) to dispose of the assessee's modification application at the outset after giving them a reasonable opportunity of being heard. (para 3,4)

  • STO 2010 CESTAT 413
  • Service Tax: Management or Business Consultant’s Service: Services received from abroad: Circular No.1/1/2001-ST dt. 27/6/2001 : Pre-deposit: The appellants have made a strong prima-facie case on the basis of the Circulars issued by the CBEC against the demand and penalty. The activity involved, prima-facie, is in the nature of legal services. These services were brought into tax net only in the year 2009, much after the period of dispute. Waiver of the dues confirmed by the adjudicating authority and stay recovery thereof pending decision in the appeal. (para 6)

  • STO 2010 CESTAT 238
  • Banking and other financial service: “Banking and other financial service” clearly indicate with regard to the asset management and also refers to depository and trust services but does not include cash management.

    Management Consultancy Service: Merely providing expert employee as agent for working day to day affairs is not Management Consultancy.

  • STO 2009 CESTAT 1661
  • Service Tax: Management consultant services’ for the period April, 2002 to March, 2008: Activities- like call logging, interaction with customer, process documentation, database administration, data migration, movement and back-up, maintenance and up-gradation of IT infrastructure, restarting failed operations, networking of hardware and software, network link maintenance, firewall configuration, IP address management, IT security and IT checks, OS and patch installation, install, administer and support third party applications, collaboration with other sites globally, web server hosting, IT spare and vendor management and developing web based applications: Scope and liability: On scrutiny of the copies of the agreements with M/s. Texas Instruments, M/s, Vijay Bank and M/s. ECGC produced by M/s. Wipro, it was seen that, M/s. Wipro(Appellants) were fully responsible for supply, hardware/software installation, upgrading, maintenance of the entire equipment, troubleshooting the same, coordinating with the respective vendors of hardware / software in order to ensure that the entire network was properly, functioning and also to advise and assist the client so that the business requirement of the client was achieved.” It can be seen from the above reproduced activities undertaken by the appellant, they provide complete solution of IT services to their customers like Vijaya Bank etc.(Para 5). This Tribunal in the case of Nirulas Corner House Pvt. Ltd. Vs. CST [2009(14) S.T.R. 131(Tri. Del.)] was analyzing very same definition and in the order, had held as under:- "8.2 The definition of management consultant makes it clear that what is envisaged from a consultant is advisory service and not the actual performance of the management function. Any other meaning to the term management consultant would render the entries relating to many other services which are rendered in connection with the management of any organization such as "manpower recruitment or supply agency" service, "business auxiliary" service as redundant. In the common parlance also, the role of a consultant is to render advice, consultancy and technical assistance in the matters on which he has the expertise. However, the decision on acceptance or otherwise of such advice is left to the management and the consultant does not have right to impose his advice. In such a situation, it ceases to be an advice and becomes an order or direction."(Para 6). The decision of the co-ordinate Bench, Chennai in the case of CMS (I) Operations & Maintenance Co. Pvt. Ltd. Vs. CCE STO 2007 CESTAT 103 has also laid down the same principle as has been enumerated by the Bench in the case of Nirulas Corner House Pvt. Ltd. (supra). This Bench in the case of IBM India Pvt. Ltd. Vs. CST, Bangalore vide Final Order No-973 to 975/2009 dt. 16/4/2009 and in the case of SAP India Sys,, Application & Products in Data Processing P. Ltd. Vs. CST, Bangalore STO 2006 CESTAT 702 was concerned with an identical issue - provision of IT services and held in favour of the assessee. Prima-facie, the services provided by the appellant may not fall under the category of 'management consultant service' from 16/5/2008. The services rendered by the appellant may get covered under the category of IT services. Since the period involved in these cases is prior to 16/5/2008, the appellant has made out a prima-facie case for waiver of the pre-deposit(Para 7,8).

    Stay granted.

  • STO 2009 CESTAT 1326
  • Service Tax: Management Consultant Service: Scope: Appellant can legitimately claim support from the view taken by the Hon'ble High Court in the case of Indian National Ship Owners Association STO 2009 Bom 73 and this tribunal's decision in the case of CCE vs Sundararn Finance Ltd, STO 2007 CESTAT 175 and Global Software Ltd. STO 2005 CESTAT 65 etc. Prima facie, in respect of the services covered by the Agreement between the appellant and the Joint Venture Company, the appellant is already registered with the department as provider of "Business Auxiliary Service" with effect from 1.7.03 and are paying service tax under that category. Such payments of service tax are being accepted by the department as well. The same services cannot be classified under any pre-existing entry of Section 65 of the Act, 1994 inasmuch as the definition of “Management Consultant” has not been shown to have undergone any change with effect from 1.7.03 with the introduction of "Business Auxiliary Service. The appellant has made out a prima facie case against pre-deposit of the demand of service tax and penalty.(Para 4).

    Stay granted.

  • STO 2009 CESTAT 1298
  • Service Tax: Management Consultant: Scope and liability: The definition of "Management Consultant" as it stood during the period in dispute cannot cover services which are in the nature of giving legal opinion and legal assistance including appearance before the statutory authority. In support of this contention, Board's Circular F.No. 341/21/99-TRU dated 20.08.99 is relied upon. Tribunal has granted" stay in respect of the case where the department sought to levy service tax on 'Professional Services" rendered by the chartered accountants under the category "Management Consultancy Services". Vide Stay Order No. 145/06 dated 21.2.06, in the case of M/s. S.B. Billimoria & Co. Vs. CCE, Chennai (Appeal No’s/99/2005). Further, Commissioner of Service Tax, Kolkatta, in the appellant's own case, has decided in the appellant's favour vide his order dated 04.12.08, and the department has not gone in appeal against the same. larger period of limitation is not applicable in this case as there was no suppression or willful mis- statement.(Para 2,4).

    Stay granted.

  • STO 2009 CESTAT 581
  • Classification: Management Consultancy Vs Business Auxiliary Service: The order is on the basis that the 'Management Fee’ accounted in the records of the assessee during the material period represented proceeds realised from its group concern towards management consultancy rendered. There is no finding as to the activity involved and if the same was classifiable under 'Management Consultant'. In the circumstances, the impugned demand of Service Tax, interest and the penalties imposed under management consultancy are held to be not sustainable.

  • STO 2009 CESTAT 543
  • Interpretation of Law: The appellant was rendering management consultancy in the organization. There was scope for difference in interpretation. The issue involved in this case is the interpretation of the provision of the Finance Act and the penalties are not warranted

  • STO 2009 CESTAT 630
  • Management Consultant Services: Explanation inserted by Notification No. 15/2002-Service Tax cannot be made applicable retrospectively. The effect of this amending Notification is that the other services rendered by the appellants would be liable to service tax under the category of 'Management Consultant Services'.

  • STO 2009 CESTAT 302
  • Use of Trade Mark: Revenue's contention that permitting the use of trade mark results into creating marketing facility and thus a taxable service under the category of Management Consultancy is ruled out. Revenue's appeal is dismissed.

  • STO 2009 CESTAT 326
  • Import of Services: The issue involved is that the amount paid by the appellant to one who rendered the service and who had no office in India, would be liable to pay tax. Prima facie, the case is covered by the Larger Bench decision of the Tribunal in the case of Hindustan Zinc Ltd. vs. C.C.E., Jaipur.

  • STO 2008 CESTAT 169
  • Intention to evade: It is not a case where they had not paid the service tax and the Department detected their lapse and issued the show cause notice. It is very clear that there is actually no intention to evade payment of service tax.  Appeal allowed with consequential relief.

  • STO 2008 CESTAT 44
  • Stay : Classification of services : Nature of services rendered by the appellants to the service receiver would fall under business auxiliary service or management consultancy service would be decided on the basis of details to be provided by the appellants regarding the nature of services provided by it. As the appellants had not given these details, no prima facie case made out, partial waiver granted.

  • STO 2008 CESTAT 214
  • Retrospective coverage : Intellectual Property became a taxable service much after the material period. Therefore, the same activity engaged in by JIPM cannot be taxed as ‘Management Consultancy’ during the material period. The material period terminates prior to 16-8-2002. Based on the decision of Tribunal in the case of Kerela State Electricity Board, appeal allowed with consequential relief

  • STO 2007 CESTAT 1198
  • Import of Services : Service tax liability on the recipient of service from service provider staying abroad for the period prior to 1.1.2005 being arbitrary due to distinct opinion expressed by different Benches of Tribunal, matter referred to Larger Bench.

  • STO 2007 CESTAT 1289
  • Stay : The activities undertaken by appellants for their Joint Venture Partners are not advice but cost incurred for supply of stationery, conveyance & travel expenses subscription expenses, water bills stamping CAG-ROC etc. These services as done by the applicant/appellant, may not fall under the category of consultancy and cannot get covered under the services of Management Consultant. Prima facie strong case made out. Waiver granted.

  • STO 2007 CESTAT 1075
  • Stay: Management Consultancy Service: Various pleas related to demand being time barred, etc raised by the appellant. Application partly allowed.

  • STO 2007 CESTAT 562
  • Service Tax: Management Consultancy Service: Scope: Prima facie, demand is not sustainable since "Liaisoning & Representation" are not consultancy services(Para 2).

    Stay application allowed.

  • STO 2007 CESTAT 282
  • Service Tax: Management Consultancy Service: Scope and liability: The total realization under the agreement is required to be distributed among the various services rendered and only that portion which related to management consultancy can attract duty. Sample copies of agreements have been filed. There is no dispute that the agreement is a composite agreement. It states that the appellant shall "assist ….. for blending and bottling of ….. Indian Made Foreign Liquor". The detailed terms of the agreement also make it clear that the appellant's involvement is in a vast area of selection of materials, process of bottling, obtaining of permission for marketing etc. In the above circumstances, clearly the demand is highly exaggerated. Therefore, there is no justification to order the deposit of the full demand.(Para 2,3,4).

    Partial pre-deposit ordered.

  • STO 2007 CESTAT 1162
  • Stay: Management Consultant Service: The essence of management consultancy is that the service should be rendered only to an organization. Prima facie, the services rendered to an individual cannot be considered as Management Consultancy Services. 

  • STO 2007 CESTAT 507
  • Service Tax: Online data processing, Cad Cam designing, annual maintenance of SAP service: Taxability of ERP software system and management service: The appellant M/s. Tata Technologies Limited have furnished an agreement dated 31-3-1997 whereby SAP India granted license to the appellants to use SAP or ERP software for 5000 users. The appellant is nodal agency to act on behalf of the Tata group company. In terms of agreement entered between SAP India and the appellant, SAP India grants a license to use SAP proprietary ERP software upon the terms and conditions set forth in the agreement. The said software is meant for use of the Tata group companies in terms of agreement. The use of the software is permitted to the affiliates of the appellant who are all group companies. Each affiliate enters into agreement with the SAP India for the use of software. The amount of license fee shall be calculated based on the total number of users and software license. There is also provision of fees for maintenance service. Even the appellant has to pay license fee to SAP India. The appellant in turn collects the share of each affiliate and passes it on to SAP India. From this one thing is clear that the appellant is not rendering management service in relation to software. The software is actually provided by SAP India. There is also tripartite agreement entered into by SAP India, the appellant and affiliates of the appellant. Each affiliate places purchase order on the appellant for SAP software and also SAP AMC (annual maintenance contract). The appellant raised the invoice on the affiliate for SAP AMC. Actually SAP India delivers software to the affiliates of the appellant. The appellant received the amount for SAP software and also annual maintenance from the affiliates and pays the same to SAP India. It is very clear that the appellant only acts as agent for SAP India. They enable the group companies of Tata group to procure the SAP software and its maintenance. In the circumstances, the appellant is not providing management consultancy service to the affiliates. Therefore the demand of service tax on the appellant on the ground that they provide management consultancy service is not sustainable.(Para 5).

    Appeal allowed.

  • STO 2007 CESTAT 103
  • O&M Contract: Business Auxiliary Service: When the generation of electricity amounted to manufacture, the question of providing Business Auxiliary Service did not arise. The O&M Contract was for generation of electricity. Therefore the activity did not come under Business Auxiliary Service.

    O&M Contract: Consultancy Service: The conclusion of the appellants rendering consulting engineer service was arrived at on the basis of certain terms of the contract relating to pre-operating and operating periods. These were part and parcel of the contract of operation and maintenance and were not for rendering service to ST-CMS.

    O&M Contract: C&F Service: Lignite being the primary fuel for operation of the plant, it was the obligation of the appellants to ensure availability of sufficient stock of lignite in the facility. Taking delivery of lignite from the transporter, maintaining stock and inventory thereof by the appellants, were in relation to operation of the facility. It was incorrect to construe such obligation in terms of O&M contract as providing C& F Service to ST-CMS.

    O&M Contract: Repair & Maintenance: Appellants maintained only the plant and the taxable service of maintenance or repair of goods/equipment covered by the Act were done by the suppliers of the equipment under warranty or Annual Maintenance Contract (AMC). They had rendered the service to themselves and not to another person. Therefore no liability is incurred by the appellants on this account.

    Work Contract: A works contract for manufacture of an item as prescribed in Section 2(f) of the Central Excise Act, 1944 cannot be vivisected to charge tax on some part of the activities involved. Tax cannot be levied when the liability of the assessee is not determined precisely with respect to each of the taxable services found to have been rendered. No tax can be levied without specifying taxable value.

  • STO 2007 CESTAT 49
  • Service Tax: Management Consultancy agreement: Demand: The perusal of the clauses of an agreement make it clear that under the agreement with Indo Gulf Industries Ltd. the appellant has been "entrusted the operation of the factory". The remaining clauses of the agreement are to enable the appellant to perform the operation of the factory smoothly and well. The agreement is not for any advice or consultancy. The definition of management consultant under the taxing statute makes it clear that what is envisaged from a consultant is advisory service and not the actual performance of the management function. In the present case, the appellant was in-charge of the operation of the factory and thus was performing the management function. Tribunal dealt with a similar case in its decision in the case of Rolls Royce Industries Power (I) Ltd. v. CCE, Vishakhapatnam as reported in STO 2004 CESTAT 102 and held that Service Tax as consultant is not attracted to a case where, under a contract, the operation and management of an industrial unit is taken over by a party. (Para 6,7).

    Appeal allowed.

  • STO 2007 CESTAT 508
  • Service Tax: Management consultancy services: Scope and liability: Management Consultant' means any person who is engaged in providing any service, either directly or indirectly, in connection with the management of any organisation in any manner and includes any person who renders any advice, consultancy or technical assistance, relating to conceptualizing, devising, development, modification, rectification or upgradation of any working system of any organization. It appears that the development of software and maintenance of the software in question SAP R/3 are done only by SAP India. The role of the appellant, prima facie, appears to be a wholesale procurer of service and distributor of service to the affiliates. This may not be fitting into the category of management consultancy services. They have prima facie made out a case for waiver(Para 5,6).

    Pre-deposit waived, stay allowed.

  • STO 2007 CESTAT 91
  • Service Tax: Management Consultancy Services: Transfer of technology and know-how from foreign country: The services rendered by the UK Company to the Indian Company can by no stretch of imagination be considered as falling within the definition of "Management Consultant". The agreement dated 29-3-93 refers to request of the Indian Company to the UK Company to impart benefits of specialized technology and technical services and know-how in the UK to enable it to blend, produce and market Castrol products and since marketing will fall within the definition of working system of an organization, Service tax has rightly been confirmed under the heading of Management Consultant", is not tenable as there is no any force in the above submission that know-how for marketing the product is in relation to the working system of the organization. Both, the 1993 as well as 2001 agreements provide for payment of royalty in UK in Pounds Sterling on sale of all the products manufactured by the Indian Company and it is further provided that if in any financial year the Indian Company has no profits, no royalty will be payable to Castrol UK. This only reinforces the view that payment is for the services rendered in relation to the products and royalty is payable on sale of products.(Para 6).

    Appeal allowed.

  • STO 2007 CESTAT 94
  • Service Tax: Management Consultant' and as 'Commercial training or coaching centre': Demand: Time bar: The appellants sought a clarification from the Ministry of Finance and there was a clarification in favour of the Department. As soon as the clarification was given, they voluntarily paid the Service Tax. The appellant is an institution sponsored by the Government of Kerala. The plea of time bar can be taken into consideration to grant the appellants partial waiver.(Para 5).

    Partial pre-deposit ordered.

  • STO 2007 CESTAT 499
  • Management Consultancy Service: Locus Standi: There is no liability to pay tax or penalty on the appellants STL as regards the services availed during 28-2-99 to 16-8-02. Penalties were imposed on JIPM only. Therefore, the stay application is infructuous and is accordingly dismissed.

  • STO 2007 CESTAT 175
  • Management Consultant: None of the services involve advice, consultancy, or technical assistance relating to conceptualization, devising, development, modification, rectification or upgradation of any working system of the JV company. Some of the services are covered by the definition of "Business Auxiliary Services", which came to be introduced for levy of service tax w.e.f. 1-7-2003. The services in question were rendered in Oct 1999. The definition of "Management Consultancy" has continued to be same even after introduction of "Business Auxiliary Services" for levy of service tax. It would, therefore, mean that a service appropriately classifiable as "Business Auxiliary Service" cannot fall within the ambit of "Management Consultancy".

  • STO 2006 CESTAT 603
  • Service Tax: Management consultant: Scope: Perusal of the agreement brings out that the appellant has an active responsibility in regard to the management of the facility. Consultancy element is very limited.(Para 6).
    Pre-deposit ordered.

  • STO 2006 CESTAT 105
  • Service Tax: Management Consultancy: This issue was considered by this Bench in Stay Order No. 145/2006, dated 21-2-2006 STO 2006 CESTAT 684 which was passed in the case of S.B. Billimoria & Co. [Appeal No..S/99/2005] and it was prima facie held that the above amendment had no retrospective effect and accordingly waiver of pre-deposit and stay of recovery were allowed(Para 1).

    Pre-deposit waived and stay granted.

  • STO 2006 CESTAT 495
  • Service Tax: Consulting Engineer's Service" and "Management Consultancy Service": Demand: The scope of the definition of "Consultancy Engineer's Service" seems to be quite enlarged by generously accommodating a number of activities connected to the discipline of engineering. The contention of the appellant that the transfer of know-how took place in 1998 and payments made subsequently were not towards any services appears to us as unnatural as a barrister's wig. It is clear from the agreement that not only know-how was to be supplied, but it was to be laced with technical assistance and training and other clauses. It is not, therefore, possible to accept the contention that the appellant did not provide a taxable service at this stage. Further, a perusal of "Support Services Agreement" has made it clear that "Consultancy Engineering Services" has been provided by the foreign company.(Para 10).

    Pre-deposit ordered.
     

  • STO 2006 CESTAT 594
  • Service Tax: Management Consultancy Service: Scope and liability: The definition of Management Consultancy Service is, in very broad terms. But that does not mean that any and every advise would be a Management Consultancy Service. Apparently, the appellant organization is not a Management Consultancy organization. Its expert staff are mostly engineers. The service rendered also is in the area of general awakening; conducting seminars, delivering lectures etc. It would be hard to conceive of such general efforts as consultancy. Consultancy has the connotation of relating to specific instructions on specific problems of particular clients. Therefore, prima facie, the appellant is right in its contention that it is not a Management Consultancy.(Para 7).

    Stay allowed, pre-deposit waived.
     

  • STO 2006 CESTAT 639
  • Service Tax: Management consultant: Scope: They have no relation with PWCDA and they cannot be charged with service tax for services rendered by the London Company directly to the Government of Karnataka. Prima facie their submission has strong force(Para 4). The evidence produced with regard to the inter-office memos which has not been considered by the authorities. The other categories pointed out are not taxable. Since the appellants have already pre-deposited more then 50% of the amount, their plea has to be accepted for granting waiver(Para 5).

    Pre-deposit waived, stay allowed.

  • STO 2006 CESTAT 705
  • Service Tax: Management consultancy services: Demand for extended period under Central Excise Act: after the Tribunal held that Varco was an independent identity and not a dummy manufacturing unit of the appellant, the Revenue directed its consideration to the question whether the same situation warranted imposition of service tax. Once Varco was held to be an independent unit and not dummy unit controlled by the appellant, as was alleged in the previous show cause notice which was issued in the context of the valuation, obviously the question as to whether management services and consultancy services were provided, arose. It appears that there was material on record to show that management aspects were controlled by the appellant. However, since the Revenue resorted to the provisions of the Excise law for recovery of the Excise duty by alleging that Varco was a dummy unit of the appellant and appellant was the real manufacturer, that lapse as it turned out to be, will not come to the aid of the Revenue on the aspect that there was intention, to show that management consultancy services were being provided to Varco. Therefore, the question whether the extended period could be invoked or not, would arise in this case(Para 5).

    Stay allowed, pre-deposit waived.

  • STO 2006 CESTAT 69
  • Stay: Management Consultant Service: Mere facts of non-registration by itself will not be a ground to come to a conclusion that there was suppression of facts.Waiver granted.

  • STO 2006 CESTAT 684
  • Service Tax: Practicing Chartered Accountants: Demand: Penalty: The Explanation considered by the High Court was expressly clarificatory inasmuch as it used the word 'clarified'. The Explanation now under consideration in the present case is couched in a different language. Prima facie, it purports to add to the tax liability of a PCA, Practising Company Secretary and Practising Cost Accountant, by providing that the exemption under Notification No. 59/98-ST, dated 16-10-1998 would not be applicable to services provided by these professionals, which may fall in any other taxable services defined in Clause (90) of Section 65 of the Finance Act, 1994. The legislative intent is amply clear. Prima facie, taxable services under Clause 90 of Section 65 of the Act were sought to be excluded from the scope of exemption. Notification No. 59/98-ST, on its face, did not include "Management Consultant's service" in the list of 'taxable services' of PCAs. Hence for the period of dispute, apparently, the appellants were not liable to pay Service tax on Management Consultant's service rendered by them. They have made out prima facie case for waiver(Para 2).

    Pre-deposit waived, stay allowed.

  • STO 2006 CESTAT 271
  • Service Tax : Condonation of delay: Adjustment of refund against demand: As such, no confirmed demand exists against the appellant. The amount of refund sanctioned by the adjudicating authority can not be adjusted and the refund is payable to the appellant. hus, the refund due to the appellant was adjusted against a demand which remains vacated by the Order dated 30-7-2005 of the Commissioner. That adjustment cannot survive. In the present appeal, the revenue seeks to point out the error in the Order dated 30-7-2005 of the Commissioner (Appeals). That is not permissible. If the revenue was aggrieved with that order, appeal was required to be filed in time. After that Order-in-Appeal had become final, it is not open to the revenue to challenge it on merits in a collateral proceeding.(Para 2,3,4).
    Revenue appeal and application for COD rejected.

  • STO 2006 CESTAT 70
  • Management Consultancy Service: Appellants demonstrated that the services rendered to M/s. Karnataka Electric Power would only fall within the ambit of Business Auxiliary Services Scientific and Manpower Recruitment Agency Technical Consultancy Services. During the relevant period, except scientific and technical consultancy services, the other services rendered by the appellant would not be subjected to service tax since BAS came into effect only in 2004 and contention of department that prior to that period these services would be covered under Management Consultancy services not accepted. The demand of duty under the category of management consultancy services is not correct.

  • STO 2005 CESTAT 193
  • Service Tax: Management Consultancy Service: Demand: There is no dispute that management consultancy services came into existence w.e.f. 16-10-98 under the service net. Therefore, any service provided before that date is not chargeable to service tax. The respondents have established that service provided by them was between 15th to 19th July, 1998.(Para 3)

    Revenue appeal rejected.

  • STO 2005 CESTAT 129
  • Service Tax: Management Services: Waiver of pre-deposit: The services for which they are taxed are not mentioned in the Mumbai Bench's order in the case of Glaxo Smithkline Pharmaceuticals Ltd. v. CCE. Mumbai-IV- STO 2005 CESTAT 302 wherein it was held that services rendered towards publicity, freight, travelling, power and fuel, rent and misc. expenses are not covered under 'Management Consultancy Services'..(Para 5).

    Pre-deposit ordered.
     

  • STO 2005 CESTAT 7
  • Management Consultancy: Respondent merely engaged in advising the clients in a field of programming which not related to basic business activity of clients. Therefore respondents not within the definition of "Management Consultancy". Appeal dismissed.

  • STO 2005 CESTAT 65
  • Service Tax: Management Consultancy: Scope and tax liability: Commercial training and coaching centres were brought within the purview of service tax for the first time in 2003-04. Even after addition of such centres to the list of taxable service providers, "Management Consultant" has continued to be in that list. The legislative authority did not amend the definition of "Management Consultant" while adding "commercial training and coaching centre", which, obviously, were understood as operating in mutually exclusive areas. If that be so, the 'computer training' provided by the appellants to trainees sponsored by their corporate clients during May, 2000 to Mar., 2002 must be held not taxable as 'Management Consultancy Service'. It is also pertinent to note that such training is exempted from payment of service tax right from the date on which it was declared to be taxable.(Para 3).

    Appeal allowed.
     

  • STO 2005 CESTAT 302
  • Management Consultancy Service: Levy on staff costs could be as on business auxiliary service, which was not a Taxable Service prior to 2003 & appellant is not a service provider as Management Consultant.

    Valuation: Other Expenses: Service rendered towards publicity, freight, travelling, power and fuel, rent and miscellaneous expenses are not covered under definition of 'Management Consultancy Services'. Service tax not leviable on expenses towards such 'other expenses' recovered by appellant from its group company

  • STO 2004 CESTAT 109
  • Service Tax: Demand: Waiver of pre-deposit and stay: The present demand includes components such as sale of software, maintenance thereof, etc. which the Assistant Commissioner in his order has held not to be a service chargeable to tax. A sum of Rs. 2.9 crores has already been deposited by the applicants(Para 4,5).

  • STO 2004 CESTAT 42
  • Service Tax: Management Consultancy Service: Waiver of pre-deposit: CBEC Circular No. 59/8/2003-S.T., dated 20-6-2003 whereby it has been clarified by the Board that services in relation to vocational training institute, computer training institute, and recreational training institute would not be chargeable to service tax.The dispute is relating to the service provided in the areas of training/courses by the appellants in relation to LAN/VAN/SAN Engineering, Net work engineering & System Management, Sun solaris administration etc. The contention of the appellant is that specialised courses conducted on topics of information technology, both software and hardware, were more in the nature of imparting service relating to education and the appellants have not collected any service tax in respect of the course fee which they had collected.(Para 3).

    Partial pre-deposit ordered till final disposal of appeal.

  • STO 2002 CESTAT 21
  • Service Tax: Management Consultant: There is nothing in the definition of Management Consultant or otherwise in support of submission that a Management Consultant should have any particular academic or professional qualification. In fact, the case may be opposite also. Years of experience in management, gives persons insights which an academic cannot gather. It is also seen from the assignment agreement that the appellant is to advice the company on matters relating to production, commercial, marketing, financial matters, etc. Ld. DR has also rightly contended, based on the Consultancy Bill, that the payment is towards professional charges. No merits in the appeal.(Para 3)

    Appeals dismissed.

     
     

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