Case Details: Birlasoft Ltd. vs. Commissioner of Central Excise and Service Tax, Pune-I (2025) 36 Centax 140 (Tri.-Bom)
Judiciary and Counsel Details
- S/Shri S.K. Mohanty, Member (J) & M.M. Parthiban, Member (T)
- S/Shri Sachin Chitnis & Viraj Reshamwala, Advs., for the Appellant.
- Shri Ajay Kumar Shrivastava, Auth. Representative for the Respondent.
Facts of the Case
The assessee faced a Service Tax demand under the category of Consulting Engineer’s service for expenses incurred in setting up a joint venture company (JVC), including employee costs, travel, administrative, legal, and staff welfare charges. It had reimbursed these expenses on an actual basis from the JVC. The show cause notice alleged that the assessee provided civil engineering consultancy services, including site selection, plant layout, and lease arrangements, but these claims were factually incorrect. Thus, the matter was placed before the Customs, Excise and Service Tax Appellate Tribunal (CESTAT).
CESTAT Held
The CESTAT held that reimbursed expenses could not be treated as consideration for taxable services under the Consulting Engineer’s service. Section 65(31) of the Finance Act, 1994 defines a consulting engineer as a professionally qualified engineer providing advice or technical assistance in engineering; the assessee did not meet this definition. Consequently, the Service Tax demand on the reimbursed expenses was quashed, and the appeal was allowed in favour of the assessee.
