Arafaath Travels Pvt. Ltd. Vs Commissioner of GST & Central Excise (CESTAT Chennai)
The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) allowed the appeals filed by the appellant, a registered provider of air travel agency services, and set aside the service tax demands raised on visa facilitation charges collected for obtaining Saudi Arabian visas.
During audit proceedings, the Department examined the appellant’s profit and loss accounts and noticed that the appellant had collected visa and documentation charges from travellers and business entities for obtaining visas through authorized agents of the Saudi Arabian embassy in Mumbai. The Department considered that the appellant, by assisting travellers in procuring visas, was acting as a commission agent and rendering taxable “Business Auxiliary Service” under Section 65(19) of the Finance Act, 1994.
A show cause notice dated 11.01.2013 was issued invoking the extended period of limitation on the allegation that the appellant had failed to pay service tax on such services and had not disclosed the income in ST-3 returns. Service tax of Rs.13,04,044 was demanded for the period 2008-09 to 2011-12. A subsequent statement of demand dated 23.04.2014 sought service tax of Rs.1,92,249 for the period April 2012 to June 2012. The adjudicating authority confirmed the demands along with interest and imposed penalties under Sections 76, 77, and 78 of the Finance Act.
