Custom, Excise & Service Tax Tribunal
State Bank Of India vs Commissioner Of Central Excise, Nashik on 7 April, 2015
IN THE CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT MUMBAI
Appeal No.
ST/08/09
- Mum
(Arising out Order-in-Appeal No. IPL/202 NSK/2008 dated 15.10.2008 passed by the Commissioner of Central Excise (Appeals), Nashik)
For approval and signature:
Honble Mr. M.V. Ravindran, Member (Judicial)
Honble Mr. P.S. Pruthi, Member (Technical)
1. Whether Press Reporters may be allowed to see No
the Order for publication as per Rule 27 of the
CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the No CESTAT (Procedure) Rules, 1982 for publication
in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy Yes
of the Order?
4. Whether Order is to be circulated to the Departmental Yes
authorities?
State Bank of India
Appellant
Vs.
Commissioner of Central Excise, Nashik
Respondent
Appearance:
Shri Venkatesh Iyer, Advocate for the appellant Shri B. Kumar Iyer, Supdt. (AR) for the respondent CORAM:
Honble Mr. M.V. Ravindran, Member (Judicial) Honble Mr. P.S. Pruthi, Member (Technical) Date of hearing : 07/04/2015 Date of decision : 07/04/2015 O R D E R No:..
Per: M.V. Ravindran:
This appeal is directed against Order-in-Appeal No. IPL/202 NSK/2008 dated 15.10.2008.
2. Heard both sides and perused the record.
3. On perusal of the record, we find that the issue involved in this case is regarding the discharge of service tax liability on an amount collected by the appellant from their customers as an amount paid towards the postage charges, courier charges. It is the case of the revenue that these charges are collected by the appellant from their customers in course of renting their services of Banking and financial services. It is the case of the appellant that postage and telegraph and courier services are engaged by them for correspondence and they only claim the actual amount which has been paid by them to this service provider and also pay service tax to the service provider.
4. We find that the issue is no more res integra as the impugned order as well as the Adjudicating Authoritys order seeks to rely upon Rule 5(i) of the Service tax (Determination of Value) Rules, 2006 to include this amount as a taxable amount as a consideration for the services under the provisions of Section 67 of the Finance Act, 1994. This very identical issue of discharge of service tax liability of the reimbursement of the actual expenses was considered by the Hon'ble High Court of Delhi in Intercontinental Consultants & Technocrats P. Ltd. 2013 (29) STR 9 (Del) wherein the Lordship had struck down Rule 5(i) of Service tax (Determination of Value) Rules, 2006 holding that these provisions are ultra vires of Section 67 of the Finance Act, 1994.
5. Since the provisions on which reliance was placed to confirm the service tax liability have been struck down, we do not find any merits in the arguments put forth by the ld. Departmental Representative. The impugned order is unsustainable and is liable to be set aside and we do so.
6. The impugned order is set aside and the appeal is allowed with consequential relief, if any.
(Dictated in Court) (P.S. Pruthi) (M.V. Ravindran) Member (Technical) Member (Judicial) //SR 3