No service tax if no service provider or receiver contract between the parties

Vainguinim Valley Resort Vs Union of India (Bombay High Court)

The Hon’ble High Court held that there was no service provider or service receiver contract between the parties justifying the levy of service tax set aside. Matter remanded back.

The Department issued show cause notice on the Petitioner demanding service tax on the amount received from joint venture of Petitioner and Goa Golf Club Pvt. Ltd. for providing infrastructural facilities for the purpose of running a casino. The Petitioner replied to such show cause notice stating that the joint venture agreement dated 05.04.2002 was terminated with effect from 01.04.2013 by executing a deed of cancellation. The Department did not consider the reply submitted by the Petitioner and passed impugned order confirming demand of service tax.

The Hon’ble High Court held that there was no service provider or service receiver contract between the parties justifying the levy of service tax. Further, there is non-application of mind while passing the impugned order as the Department failed to take into account reply and the document produced by the Petitioner. The Hon’ble Court set aside the order by remanding it to the said authority to decide it afresh by considering reply filed by the Petitioner.

FULL TEXT OF THE JUDGMENT/ORDER OF BOMBAY HIGH COURT AT GOA

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