No Service Tax payable on liquidated damages received in the nature of penalty

M.P. Audyogik Kendra Vikas Nigam (Indore) Limited Vs Commissioner, Central Goods, Service Tax and Central Excise (CESTAT Delhi) CESTAT set aside the order of the Revenue Department demanding Service Tax on the amount of liquidated damages. Held that, Service Tax is not payable on liquidated damages collected in the nature of penalty. Facts: M.P. Audyogik Kendra Vikas Nigam (“the Appellant”) is engaged in providing taxable services under the head renting of ‘Immovable Properties, Legal Consultancy, Manpower Supply Service etc.’. A Show Cause Notice (“SCN”) dated April 04, 2019 was ...