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Classification of service cannot be changed at service recipient’s end.
Facts
The appellant received management
consultancy services. However, department intended to classify it as Business
auxiliary Services. Relying on numerous judicial pronouncements, it was
contested that classification by service provider cannot be changed at
recipient’s end. It was argued that service provider had paid service tax under
management consultancy category at the behest of revenue and therefore,
classification cannot be altered.
Held
Relying on CCE Pondicherry vs.
Mohan Breweries & Distilleries Limited 2010 (259) ELT 176 (Mad.) and also
on Sarvesh Refractories Pvt. Ltd. vs. CCE & C 2007 (218) ELT 488 (SC), it
was Held that classification cannot be changed at service recipient’s end.
Credit of service tax paid cannot be denied or reduced on the grounds that
classification was wrongly done by service provider. Accordingly, appeal was
allowed.
