2018 (3) TMI 556 – ALLAHABAD HIGH COURT – 2018 (12) G. S. T. L. 286 (All.) – Business Auxiliary Services – appellants are franchisee/distributors appointed by the BSNL for sale of SIM cards – Held that: – the law is settled by the Hon'ble Apex Court in the case of Martend Food & Dehydrates Pvt. Ltd. [2013 (6) TMI 339 – CESTAT NEW DELHI], where it has been held that the activities of purchase and sale of SIM cards belonging to BSNL where BSNL has discharged the service tax on the full value of the SIM cards does not amount to providing business auxiliary service – appeal dismissed – decided against Revenue. – Central Excise Appeal No. 28 of 2018 Dated:- 9-3-2018 – Hon'ble Bharati Sapru And Hon'ble Harsh Kumar, JJ. For the Appellant : Piyush Agrawal ORDER Heard Sri Piyush Agrawal learned counsel for the appellant and Sri Subham Agrawal assisted by Ms.Sanyukta Singh learned counsel for the respondent assessee. This is department's appeal under section 35-G of the Central Exc
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art of the activation charges as no activation is possible without a valid functioning of SIM card and the value of the taxable service is calculated on the gross amount received by the operator from the subscribers and the present transactions to BSNL and payment by BSNL were different, whether the Hon'ble CESTAT was justified in dropping the demand of service tax? (d) Whether the Hon'ble CESTAT erred in treating it as double taxation when services are distinct? Service tax is paid on full value of SIM card by BSNL under the "Telecommunication Service" and not under "Business Auxiliary Service". In the instant case, service tax has been demanded from the respondent under the category of "Business Auxiliary Service" on the communication received from BSNL, which is entirely different from "Telecommunication Service"? (e) Whether the Hon'ble CESTAT has erred in not taking into account of its own case passed vide final order no.ST/A/684
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stributors appointed by the BSNL and as per documents on record during the material period they were engaged in purchase of SIM cards from M/s. BSNL and their respective sale to the buyers. The records show that they have not provided any service in relation to sale promotion of goods belonging to M/s. BSNL. As such the activities carried out by them cannot be treated as falling within the purview of 'Business Auxiliary Service'. Moreover M/s.BSNL have already discharged the burden of Service Tax on the gross amount of SIM cards and demand of service tax on the same amount from the appellants will only lead to double taxation which is not permissible under the law. Hence the demand of service tax as ordered vide impugned order in original is not sustainable. Further when the demand is not sustainable, penalties imposed are also not maintainable. Having heard learned counsel for the parties and having perused the material on record, we are of the view that in view of the law set
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