Service tax relief for ore purchases is granted to JSW Steel.
Economic Times
India
12-02-2024
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In a case involving lump sum purchases of iron ore, the Chennai bench of the Customs, Excise and Service Tax Appellate Tribunal found that the mine lease holder, not the customer, is responsible for paying service tax on minerals that are auctioned. This decision provided relief to JSW Steel. In an e-auction overseeing the sale of minerals in the districts of Bellary, Chitradurga, and Tumkur in Karnataka, a monitoring committee established by the SC purchased 16,000 tonnes of lumps of iron ore from Sesa Sterlite.
According to the revenue department, JSW was required to pay service tax under the reverse charge system because it had received services from the monitoring committee.
The central excise commissioner and GST subsequently decided that JSW Steel, not Sesa Sterlite, was responsible for paying the ?5 crore service tax. The corporation then filed an appeal with the appellate panel, which rendered a decision last week.