2026-VIL-302-CESTAT-DEL-ST
  1. Home
  2. 2026-VIL-302-CESTAT-DEL-ST

SERVICE TAX CESTAT Cases

Service Tax - Leviability of Service Tax on Route Navigation Facility Charges [RNFC] and Terminal Navigation Landing Charges [TNLC] along with the liability on certain Miscellaneous Income – Appellant was providing Route Navigation Facility Charges (RNFC) and Terminal Navigation Landing Charges (TNLC) to airlines - On the issue of leviability of service tax on RNFC, the Tribunal had earlier remanded the matter for de-novo adjudication to determine whether the entire RNFC service was provided within the airport/civil enclave. In the re-adjudication, the revenue authorities confirmed the demand on RNFC as well as TNLC since the appellant failed to provide any evidence that the RNFC service was provided outside the airport/civil enclave – HELD - The Tribunal has clearly held that only if the entire RNFC/TNLC services is provided within airport/civil enclaves, then the same can be held to be exigible to service tax - The RNFC covers communication, navigation, and surveillance services provided while an aircraft is flying through Indian airspace, including overflying flights. These services are provided throughout the route from the starting point to the destination, with the help of Aeronautical Communication Stations located every 100 kms and manned by separate personnel. Hence, the entire RNFC service is not provided within the airport/civil enclave. Consequently, the RNFC is not exigible to service tax. However, the TNLC is a charge for assisting the aircraft during the terminal landing phase and use of airport facilities, which is provided exclusively within the airport/civil enclave. Therefore, the TNLC is held to be exigible to service tax - The demand on RNFC is set aside, while the demand on TNLC is upheld and remanded only for quantification. The demand on Miscellaneous Income is set aside. The show cause notice is held to be within the normal limitation period – The appeal is partly allowed - Issue 2: Service Tax on Miscellaneous Income - The revenue authorities had also demanded service tax on the appellant's Miscellaneous Income, which included profit on sale of fixed assets, interest on staff advances, and sale of scrap. HELD - The nature of the Miscellaneous Income does not relate to the provision of any service, and hence, it is not exigible to service tax. Further, appellant being a Central Government Organization would not intentionally evade payment of legitimate dues. Hence, accept the contentions of the appellant and set-aside the demand confirmed under this head. Issue 3: Limitation Period - The revenue authorities had issued the show cause notice within one year from the date of filing of the periodical ST-3 returns by the appellant, which is within the normal limitation period as per the provisions of the Finance Act, 1994. Accordingly, the demand is held to be within the normal limitation period.
Download File

Quick Search

/

Advance Search

GST Resources

/

Gst Rate Finder

Tax Vista

Your Weekly Tax Recap

By Kasi Viswanathan V

Weekly Summary

VIL Video

Analysis of Union Budget 2026-27:
By CA Vivek Jalan

Create Account

Security-Code
New Code?

Log In

New User ? Forgot Password ?

Forgot Password

Security-Code
New Code?
Please Note: This facility is only for Subscribing Members.

Email this page

Feedback this page

Schedule a Demo

Schedule a demo to know the features and advantages of VILGST portal. Get to know the tips to find the desired results in faster way.

Caselaw Request Form (CRF)

Didn’t find what you are searching for? No worries, please give us the following details and VIL will email you the desired Caselaws at the earliest:

Security-Code
New Code?