Fixed Charges under Loan License Agreement Not Taxable Separately as Declared Service: CESTAT [Read Order]
The tribunal found that the fixed charges were part of the job work cost, paid to maintain confidentiality and compensate for idle plant and machinery during lean periods, not for a separate service
The Ahmedabad Bench of Customs, Excise and Service Tax Appellate Tribunal(ITAT) ruled that fixed charges received under a Loan License Agreement for job work manufacturing cannot be taxed separately as a declared service under Section 66E(e) of the Finance Act, 1994. Standard Pesticides Pvt Ltd,appellant-assessee,manufactured pesticides and chemicals under a Loan License Agreement with M/s….
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