Case Law Details
Universal Power Systems Private Limited Vs Commissioner of Service Tax (CESTAT Chennai)
CESTAT Chennai held that any other amount, other than gross amount charged for providing taxable service, which is calculated not for providing such taxable service cannot a part of that valuation as that amount is not calculated for providing such ‘taxable service’.
Facts- During the course of audit of the accounts of the appellant by the Internal Audit Group, it appeared that they had noticed the agreements entered by the appellant with music directors/music companies’ association for procuring ringtones and paid royalty charges at agreed rates per download.
It appeared that there were separate agreements between the appellant and various mobile telecommunication operators to provide ringtones, pictures, etc., that could be downloaded by the customers from the mobile platform developed, installed and maintained by the appellant, for which the appellant was entitled to revenue sharing at agreed rates per download by those mobile operators.
Accordingly, a Show Cause Notice was issued proposing to demand the differential Service Tax of Rs.1,13,50,388/- for the period from May 2006 to March 2011 along with applicable interest and penalties taking recourse to the valuation as per Section 67 of the Finance Act, 1994 read with Rule 5 of the Rules ibid.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
