2026-VIL-1878-CESTAT-DEL-ST
  1. Home
  2. 2026-VIL-1878-CESTAT-DEL-ST

SERVICE TAX CESTAT Cases

Service Tax - Inclusion of reimbursed cost of diesel in taxable value - Section 67 of the Finance Act, 1994 - Assessee provided Management, Maintenance or Repair Service to telecom companies under contracts for procuring diesel, transporting it to sites and filling it into mobile towers, and claimed reimbursement of the cost of diesel from the service recipients - Department alleged that the cost of diesel was includable in the taxable value in terms of Rule 5(1) of the Service Tax (Determination of Value) Rules, 2006 and the Commissioner confirmed a part of the demand with penalty - Both the Assessee and the Revenue filed appeals - Whether the cost of diesel reimbursed to the Assessee is includable in the gross amount charged for the taxable service under Section 67 of the Finance Act, 1994 - HELD - Service tax is leviable on the value of the taxable services actually rendered, and Section 67 refers to the gross amount charged for providing such taxable service. Any amount which is not calculated for providing such taxable service cannot be a part of that valuation. Rule 5 went beyond the mandate of Section 67 and the Department cannot go beyond the contract value merely because of the use of the word gross in Section 67. The word charged refers to the amount billed by the service provider to the service recipient. The value of diesel was in the nature of reimbursement, the service tax had been paid on the element of service involved, and no service was rendered corresponding to the value of diesel. Diesel cannot be considered an input for the service for which a separate consideration was provided in the contract - The impugned order is modified, the appeal of the assessee is allowed and the appeal of the Revenue is dismissed
Download File

Quick Search

/

Advance Search

GST Resources

/

Gst Rate Finder

Tax Vista

Your Weekly Tax Recap

By Dr. G. Gokul Kishore

Weekly Summary

VIL Video

GST Adjudication & Appeals Reform
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?