PRICE WATERHOUSE Vs. COMMISSIONER OF C. EX., HYDERABAD

JUDGEMENT

(1.) HEARD both sides. Applicant filed this application for waiver of pre -deposit of service tax of Rs. 2,41,279/ -, interest and penalties. The contention of the applicant is that actuals which were paid and reimbursed by their clients such as out of pocket expenses are not subject to service tax under the provisions of Service Tax, therefore, demand is not sustainable. The contention is that the Service Tax (Determination of Valuation) Rules, 2006 came into force w.e.f. 19 -4 -2006 and the demand is prior to the Rules and therefore the amounts such as out of pocket expenses are not liable for service tax.

(2.) THE contention of the Revenue is that applicants are charging gross amount from their clients for providing taxable service which is not disputed. As per the provisions of Section 67 of the Finance Act, the gross amount is chargeable to service tax and hence, the demand is rightly made.

(3.) WE find that as per the provisions of Section 67 of the Finance Act, the service tax is on the gross amount received for providing a taxable service. The appellants are not disputing taxability of service provided. As applicants are receiving a gross amount for service rendered. Hence, prima facie, we find that it is not a case for waiver of pre -deposit of amount of service tax. Applicants are directed to pre -deposit an amount of Rs. 2,41,279/ - (Rupees two lakhs forty one thousand two hundred and seventy nine only) within a period of four weeks and to report compliance on 21 -3 -2011 before the Assistant Registrar of this Bench. On depositing the above amount, condition of pre -deposit of interest and penalties is waived and recovery of the same is stayed during the pendency of the appeal. (Pronounced & dictated in open Court)