#Reimbursable Expenses

The Tribunal held that consulting engineers services provided by bodies corporate before the 2006 amendment to Section 65(31) of the Finance Act, 1994, were outside the service tax net, and that reimbursable expenses incurred before the 2015 valuation changes were not includible in the taxable value. This decision clarifies the temporal applicability of amendments for corporate service providers in the infrastructure sector.

CESTAT Bangalore rules that reimbursable expenses cannot be included in taxable value for service tax before 2015 amendment to Section 67 of Finance Act, 1994, relying on Supreme Court precedent.

CESTAT Chennai rules that reimbursable expenses like terminal handling and demurrage charges cannot be taxed if recovered on actual cost basis without a consignment note, aligning with Supreme Court precedent. This shields logistics and forwarding agents from double taxation on pass-through costs, clarifying the scope of reverse charge liability under GTA services prior to May 2015.

CESTAT Chennai reaffirms that reimbursable expenses collected by service providers do not form part of taxable value under the Service Tax Valuation Rules, provided the 'Pure Agent' conditions are met. The ruling shields businesses from retrospective tax demands on expenses like freight, warehousing, and survey charges, reinforcing the Supreme Court's precedent invalidating Rule 5(1).

CESTAT Hyderabad rules that job work constituting manufacture of excisable goods under the Finance Act, 1994, is exempt from service tax, even if the principal reimburses expenses. The ruling clarifies that the nature of the activity-not the reimbursement mechanism-determines tax liability, providing relief to manufacturers engaged in job work agreements.

CESTAT Chennai rules that reimbursable expenses cannot be included in taxable value for service tax under Section 67 of Finance Act, 1994, following Supreme Court precedent.