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No Service Tax on amount recovered as Liquidated Damages
Case Law Details
- Case Name
- Rajcomp Info Service Limited Vs The Commissioner, (CESTAT Delhi)
- Appeal Number
- Only available for paid members
- Date of Judgement/Order
- Only available for paid members
- Courts
- All CESTAT, CESTAT Delhi
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Rajcomp Info Service Limited Vs Commissioner (CESTAT Delhi)
In this case Liquidated damages, has been held to be susceptible to service tax under section 66E(e) of the Finance Act by the Commissioner as an amount received for tolerating an act. According to the appellant, the liquidated damages recovered on account of breach or non-performance of a contract is not a consideration in lieu of any service. It is infact, in the nature of a deterrent so that such a breach is not repeated.
To examine this issue it would be useful to refer to the definition of “service” as defined under section 6...
