Service Tax Liability on Government Guarantee Commission for Irrevocable Debt Market Fundraising

Krishna Bhagya Jala Nigam Ltd Vs Commissioner of Central Tax (CESTAT Bangalore) Guarantee commission paid to Government was liable for service tax for providing irrevocable guarantee in raising funds from Debt market Conclusion: Since raising of finance for day-to-day operations by assessee was squarely covered within the scope of the definition of ‘support service’ and thus assessee was liable to discharge service tax on the Guarantee commission paid to Government of Karnataka or raising funds from the debt market. Held: Assessee was engaged in implementing the ongoing Upper Krishna mult...