Neelamber Catterers Private Limited Vs Commissioner of C.G.S.T. and Central Excise (CESTAT Kolkata)
CESTAT Kolkata held that any salary paid to the Directors of the Company for the service rendered by him as an employee of the company, is outside the scope of service. Accordingly, demand of service tax is not sustainable.
Facts- Vide the present appeal, the appellant has contested the demand of service tax of Rs 19,08,000/- confirmed on the remuneration paid to Four directors, the remuneration has been paid to the directors as salary and on such amount TDS was also deducted under the salary head under section 192 of the Income Tax Act, 1961& Form 16 was being issued to such directors.
Conclusion- Held that any salary paid to the Directors of the Company for the service rendered by him as an employee of the company, is outside the scope of service, Hence, I hold that no service tax would be leviable on such amount. This issue has also been clarified by the Board Circular dated 31.07.2009, which is binding on the departmental authorities. Therefore, I hold that the demand of service tax on this count is not sustainable and hence I set aside the same.
