Notice Pay Not Subject to Service Tax: Madras HC

GE T & D India Limited Vs Deputy Commissioner of Central Excise (Madras High Court)

In GE T&D India Limited vs. Deputy Commissioner of Central Excise, the Madras High Court addressed whether payments received by the employer from outgoing employees in lieu of notice period are subject to service tax under Section 66E(e) of the Finance Act, 1994. The case originated from assessments where tax authorities concluded that the employer had rendered a taxable service by tolerating the premature exit of employees, thus fitting under the clause that treats agreeing to tole

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