Custom, Excise & Service Tax Tribunal
Amtek Auto Ltd vs Service Tax - Delhi on 27 February, 2026
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CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
NEW DELHI.
PRINCIPAL BENCH - COURT NO.III
Service Tax Appeal No.50262 of 2015
[Arising out of Order-in-Original No.DEL-SVTAX-ADJ-COM-117/2014-15
dated 29.09.2014 passed by the Commissioner (Adjudication), Service Tax
Commissionerate, New Delhi]
M/s. Amtek Auto Ltd., Appellant
4, Bhanot Apartment,
Pushp Vihar, L.S.C.,
New Delhi-110 062.
VERSUS
Commissioner of Service Tax, Respondent
17 B, IAEA House, M.G. Road, I.P. Estate, New Delhi-110 002.
APPEARANCE:
None for the appellant.
Shri Mahboob Ur Rehman, Authorised Representative for the respondent.
CORAM:
HON'BLE MS. BINU TAMTA, MEMBER (JUDICIAL) HON'BLE MS. HEMAMBIKA R. PRIYA, MEMBER (TECHNICAL) FINAL ORDER NO. 50307/2026 DATE OF HEARING : 30.01.2026 DATE OF DECISION: 27.02.2026 BINU TAMTA:
1. M/s. Amtek Auto Ltd. 1 has challenged the Order-in-Original 2 dated September 29, 2014 confirming the demand of service tax under the category of 'Banking and other Financial Services' and 'Management or Business Consultant Service' under Reverse Charge Mechanism as the service provider is located outside India. 1
The Appellant 2 No. DEL-SVTAX-ADJ-COM-117/2014-15 dated 29.09.2014 1 2
2. The appellant is a public limited company incorporated in 1985 under Companies Act, 1956 and engaged in the manufacture of wide range of components for automotive applications especially used in engine, transmission and suspension systems. The appellant was registered as an Input Service Distributor 3 with the Service Tax Department. The Officers of DGCEI, Delhi Zonal Unit gathered information that the appellant has paid certain fees/charges to the non-resident overseas service providers for raising foreign currency through a term loan by way of Global Depository Receipts4, External Commercial Borrowings 5 and Foreign Currency Convertible Bonds 6 and acquisition of industries, that the same is taxable under the category of 'Banking & Other Financial Services' w.c.f. 16.07.2001 and 'Management Consultancy Service' w.e.f. 16.10.1998. It has been observed that the appellant appointed Lead Managers/Managers/Merchant Bankers who provides services in relation to selling, buying or subscribing securities as manager, consultant, advisor or rendering corporate advisory service in relation to such issue management. It includes preparation of prospectus and other information in relation to such issue determining financial structure, tie up of financiers and final allotment and refund of the subscription for debt/equity issue management and acting as advisor, consultant, co-manager, underwriter and portfolio manager. The appellant pays up-front fee, management fee, commitment fee, Interest, underwriting fee, other overheads to these service providers. On the basis of enquiry and scrutiny of documents it was observed 3 (ISD) 4 GDR 5 ECB 6 FCCB 3 that the appellant was not paying Service Tax on 'Banking & Other Financial Services' and "Management Consultant Services' for the period 2004-05 to 2006-07 and also not paid Service Tax on the services received from the service providers located outside India.
3. The appellant has received services of ECB, FCCB & GDR from various service providers, such as Barklays Bank Plc, London, Citigroup Global Market Ltd., London, Merill Lynch International, London, etc. located outside India and the services received by the appellants were liable to service tax under 'Banking & Other Financial Services'. Further, the services received for acquisition of industries were also liable to service tax under "Management Consultant Service'. Since, the service providers are not located in India, the service receiver i.e. the appellant was liable to pay service tax in terms of Rule 2(1)(d)(iv) of the Service Tax Rules, 1994 read with Explanation clause of Section 65(105), Section 66A and Section 68(2) of the Act. The provisions regarding taxability of services rendered by a non-residents (service provided from outside India and received in India) and received in India were brought under the Act with the insertion of Section 66A and the corresponding Taxation of Service Tax Rules, 2006 w.e.f. 19.04.2006.
4. Accordingly, show cause notice for demand of Service of Rs.6,39,95,889/- along with interest under Section 75 and imposition of penalty provisions under Section 76, 77 & 78 were proposed. The amount of Service Tax of Rs.2,80,47,960/-and interest of Rs.43,55,502/- deposited by the appellant during investigation were proposed for appropriation.
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5. The Adjudicating Authority vide Order-in-Original dated 29.09.2014 confirmed the Service Tax demand of Rs.3,01,83,903/- (dropped the remaining amount) under Reverse Charge Mechanism along with interest under Section 75 and imposed penalty of Rs.1,000/- under Section 77 and Rs.3,10,00,000/-under Section 78 of the Finance Act, 1994.
6. Learned Counsel for the appellant has placed on record the copy of the Order dated July 9, 2020 passed by the National Company Law Tribunal7, Chandigarh Bench, wherein it has been categorically noted that the Adjudicating Authority by a common order dated July 25, 2018 has approved the Resolution Plan, which was initiated against the Corporate Debtor i.e. the appellant herein. The appellant has, therefore, relied on the decision of the Apex Court in the case of Ghanashyam Mishra & Sons Pvt. Ltd. through the Authorised Signatory Vs. Edelweiss Asset Reconstruction Company Ltd. through the Director and Ors.8, wherein it has been held as under:-
"102.1. That once a resolution plan is duly approved by the adjudicating authority under sub-section (1) of Section 31, the claims as provided in the resolution plan shall stand frozen and will be binding on the corporate debtor and its employees, members, creditors, including the Central Government, any State Government or any local authority, guarantors and other stakeholders. On the date of approval of resolution plan by the adjudicating authority, all such claims, which are not a part of resolution plan, shall stand extinguished and no person will be entitled to initiate or continue any proceedings in respect to a claim, which is not part of the resolution plan.
102.2. The 2019 Amendment to Section 31 of the I&B Code is clarificatory and declaratory in nature and therefore will be effective from the date on which the I&B Code has come into effect.7
NCLT 8 (2021) 9 SCC 657 5 102.3. Consequently all the dues including the statutory dues owed to the Central Government, any State Government or any local authority, if not part of the resolution plan, shall stand extinguished and no proceedings in respect of such dues for the period prior to the date on which the adjudicating authority grants its approval under Section 31 could be continued."
7. Following the decision of the Apex Court and also the CBEC Instruction No.1083/04/2022 dated May 23, 2022 laying down the guidelines for NCLT cases that no claims can be raised once the Plan is approved and no demands can be raised on the Resolution Applicant, who has taken over the company through such a Resolution Plan, the Tribunal in the case of Monnet Ispat & Energy Ltd. Vs. Commissioner of Central Excise, Raipur 9 held that the appeal stands abated.
8. Similar orders have been passed in a series of decisions by the Tribunal as under:-
(i) Jet Lite (India) Ltd. Vs. Commissioner, Service Tax- Delhi-II10
(ii) Alok Industries Ltd. Vs. Commissioner of Central Excise, Belapur and Commissioner of Central Excise, Mumbai Central11
(iii) V3 Engineers Pvt. Ltd. Vs. Commissioner of Central Tax, Bengaluru North West and CCE, Bangalore-II (Vice Versa)12
(iv) MC Nally Sayaji Engineering Ltd. Vs. Commissioner of CGST & CX, Bolpur Commissionerate13
(v) Murli Industries Ltd. Vs. Commissioner of Central Excise, Nagpur14 9 Final Order No.58785/2024 dated 24.09.2024 in ST Appeal No.50226/2017 10 Final Order No.59370/2024 dated 23.09.2024 11 2022 (10) TMI 801 -CESTAT-Mumbai 12 2024(6) TMI 905-CESTAT-Bangalore 13 2023(4) TMI 1076-CESTAT-Kolkata 14 2019 (366) ELT 1052 (Tri- Mumbai) 6
9. The principle that emerges from the various decisions of the Apex Court and of the Tribunal is that from the date of approval of the Resolution Plan by the NCLT, the appeal filed stands abated and the CESTAT becomes functus officio in the matters relating to the appeal. We may refer to the provisions of Rule 22 of the CESTAT Procedure Rules, 1982, which is quoted herein below:-
"RULE 22. Continuance of proceedings after death or adjudication as an insolvent of a party to the appeal or application. -
Where in any proceedings the appellant or applicant or a respondent dies or is adjudicated as an insolvent or in the case of a company, is being wound up, the appeal or application shall abate, unless an application is made for continuance of such proceedings by or against the successor-in-interest, the executor, administrator, receiver, liquidator or other legal representative of the appellant or applicant or respondent, as the case may be:
Provided that every such application shall be made within a period of sixty days of the occurrence of the event: Provided further that the Tribunal may, if it is satisfied that the applicant was prevented by sufficient cause from presenting the application within the period so specified, allow it to be presented within such further period as it may deem fit."
Considering the above provisions, the Tribunal has already taken a view that the appeal filed stands abated w.e.f. the date of the approval of the Resolution Plan by the NCLT. In the present case, the Resolution Plan has been approved on July 25, 2018 and, therefore, the appeal stands abated.
10. Learned Authorised Representative for the Department has placed on record the decision of this Tribunal in the case of M/s. G.V. Films Ltd. Vs. Commissioner of GST and Central Excise, 7 Chennai15, where the issue involved in the present appeal has been decided in favour of the Revenue. The Tribunal held that a plain reading of para 2.3 of CBIC Circular F.No.B11/1/2000 TRU dated 09.07.2001 makes it very clear that the overseas agents who handle the issue of GDR/FCCB abroad are covered under issue management and the services rendered by them are covered under 'Merchant Banking Services' as defined in Section 65(12) of FA 1994. Therefore, the services received by the appellant from the service providers located abroad with regard to their GDR/FCCB issue are clearly covered under 'Banking and other Financial Service' as per sub- clause(iii) of Section 65(12) of the Finance Act, 1994. Further, as per Section 65(105)(zm) "taxable service" means any service provided or to be provided to by a banking company or a financial institution including a non-banking financial company, or any other body corporate or any other person, in relation to banking and other financial services."
11. Learned Authorised Representative for the Department referred to the relevant para of the decision as under:-
"9.9 We further observe that the taxable services of Banking and other financial services falling under Section 65 (105) (zm) of the Finance Act, 1994 are covered under the category (iii) of Rule 3 of Taxation of Services (Provided from Outside India and Received in India) Rules, 2006. The services falling under this category (iii) become taxable and liable for payment of service tax if the recipient of services is located in India for use in relation to business or commerce irrespective of the place where the Services are rendered. In respect of category (iii) service, it will suffice that the service receiver is located in India and used the said services for business or commerce. In the present case, all the conditions prescribed under Section 66A of the Act read with Rule 3(iii) of Taxation of Services Rules, 2006 are fully satisfied as the Appellant 15 Final Order No.40807 of 2025 dated 11.08.2025 in S.T.Appeal No.40458 of 2014 8 company has permanent base in India, and consequently the Appellant is liable to pay Service tax in terms of Section 68(2) read with Rule 2(1)(d)(iv) of Service Tax Rules. 1994."
12. We appreciate that the services provided by the Overseas Service providers in relation to issue of GDR/FCCB is a taxable service covered under 'Banking and other Financial Services' under Section 65(12) read with Section 65(105)(zm) of the Act. However, in the present case, since the Resolution Plan has already been approved, the appeal stands abated, in view of the decision of the Apex Court and the Tribunal.
13. In view of our discussion above, we conclude that the present appeal stands abated.
[Order pronounced on 27th February, 2026 ] (Binu Tamta) Member (Judicial) (Hemambika R. Priya) Member (Technical) Ckp.