#Service Tax Valuation

CESTAT Chandigarh ruled that advertising agencies must include wall rent payments in the taxable value of their services, as it is an essential cost directly tied to service delivery. However, printed flex costs are excluded if billed separately as goods and taxed accordingly, clarifying the boundary between service and supply in advertising contracts.

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 Chennai rules that reimbursed expenses like freight, labour, and stationery do not form part of the taxable value for clearing and forwarding agents when they act as pure agents, reinforcing the strict application of Rule 6(1)(viii). This clarifies a critical boundary for service providers who pass through third-party costs, shielding them from unintended tax liability on non-income receipts.

CESTAT Chennai rules that ocean freight charges collected by multimodal transporters on a principal-to-principal basis between 2013-2015 are not includible in taxable value under the unamended Section 67 of the Finance Act. The ruling clarifies that reimbursable expenditures, when not billed to the end customer, escape service tax liability, offering relief to logistics service providers in pre-GST disputes.

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.