2026-VIL-1245-CESTAT-KOL-ST
  1. Home
  2. 2026-VIL-1245-CESTAT-KOL-ST

SERVICE TAX CESTAT Cases

Service Tax - Liability under Reverse Charge Mechanism for Insurance Commission - Whether commission received by insurance agent for providing services to insurance company is liable to service tax on the agent or the recipient under reverse charge – HELD – A plain reading of Rule 2(1)(d)(i)(A) of Service Tax Rules, 1994 clearly provides that in the case of commission paid by an insurance company to its insurance agent, the liability to discharge service tax is cast upon the insurance company as recipient of service under reverse charge mechanism. Once it stands established through documentary evidence including chartered accountant's certificate and bank statements that appellant acted merely as commission agent of the insurance company, the statutory liability to discharge service tax could not have been fastened upon appellant - The obligation to establish payment of service tax by recipient cannot be shifted upon appellant, and if Department entertained any doubt it was open to verify records of insurance company, inadequacy of investigation cannot be fastened upon appellant – As the services rendered by the appellant are not liable to Service Tax, there was no need to take the Registration from the Department for the said services. Moreover, the necessary ingredients for imposition of penalties are also found to be absent in this case. Accordingly, the penalties imposed on the appellant are set aside - The impugned order is set aside and the appeal is allowed - Demand on the basis of figures reflected in income tax returns and form 26AS without conducting independent verification - Whether service tax demand can be sustained solely on the basis of income tax returns and form 26AS without independent investigation establishing nature and taxability of receipts – HELD - Demand of service tax cannot be confirmed merely on the basis of figures reflected in income tax returns or form 26AS; such information may at best constitute a starting point for investigation but demand must ultimately be supported by independent and corroborative evidence establishing nature, taxability and exigibility of receipts - In the present case no such independent exercise has been undertaken by respondent and findings recorded rest merely on assumptions and presumptions rather than legally admissible evidence. Where documentary evidence brought on record during appellate proceedings establishes true nature of services and source of receipts, it becomes incumbent upon revenue to examine same on its own merits and if necessary, dislodge factual assertions by leading cogent and affirmative evidence.
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

GSTAT Filing Near: Closing Resolutions...
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

Security-Code
New Code?

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.

Security-Code
New Code?

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?