Service tax is not leviable under reverse charge mechanism for use of CRS/GDS”
Service tax is not leviable under reverse charge mechanism for use of CRS/GDS” | ||||||||
Dear Professional Colleague, Recently, the Delhi CESTAT, in the case of M/s Continental Airlines Inc. v Commissioner of Service tax, New Delhi 2015-TIOL-1481-CESTAT-DEL, has held that Service tax shall not levied in respect of the payments made to CRS/GDS under reverse charge mechanism and airport taxes collected by the Appellant from the airports . The Appellant Assessee is inter-alia providing service of transport of passengers by air embarking in India on international journey in any class other than economy class. No amount was paid by assessee to CRS/GDS service providers and they were paid by its parent company in USA. It was alleged by the Adjudicating Authority that the Appellant is liable to pay Service tax in respect of payment made to CRS/GDS under reverse charge mechanism, airport taxes collected and in respect of pre-ponement and post-ponement charges collected. The Hon’ble CESTAT has dealt with the issues which has been tabulated as under:
Further, the demand in respect of pre-ponement and post-ponement charges is an interpretational issue and therefore the extended period of limitation is not invokable and also the penalty under Section 78 was dropped as there was no positive act of wilful misstatement/suppression. |
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