Case Law Details
Manav Marketing Pvt. Ltd. Vs Commissioner of Service Tax (CESTAT Bangalore)
Introduction: Dive into the intricacies of the service tax dispute between Manav Marketing Pvt. Ltd. and the Commissioner of Service Tax, as adjudicated by CESTAT Bangalore. The case revolves around the classification of charges, including machine commissioning, office expenses, and commission. The analysis explores the agreement terms, applicability of service tax, and the crucial question of export of services.
Detailed Analysis: The dispute unfolds with CESTAT examining bills raised by Manav Marketing, where a significant portion relates to machine commissioning charges. The contention arises as to whether these services, rendered to purchasers within India, can be classified as export, despite payment received from overseas suppliers.
CESTAT scrutinizes the distributor agreement, emphasizing the distributor’s role in promoting and selling products within the territory. Notably, the services involve commissioning machines supplied directly by overseas suppliers to Indian customers. The tribunal rejects the export classification, citing the destination-based consumption tax principle, asserting that services rendered and consumed in India cannot be considered exported.
The analysis extends to office expenses, deemed as reimbursements, with no discernible service aspect. Even if considered a service, it is a service rendered to the appellant itself, leading to the conclusion that service tax is not leviable in this regard.
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