Service Tax not payable on Notional Interest on Refundable Security Deposit

Marwadi Shares & Finance Ltd Vs C.C.E. & S.T. (CESTAT Ahmedabad) The dispute in the present appeals relates to service tax on interest free deposit amount collected by the Appellant from the demat account holders under the Scheme and in lieu of the same Appellant has not collected AMC charges. However, we find that the said “Interest Free Deposit‟ did not represent value of any taxable service. The said deposit amount was kept with the Appellant as security deposit to adjust the amount in case of any default in making payment by the client. The said deposit amount also refundable t...