Service Tax Weekly Flashback: 01 To 07 February 2026

Service Tax Weekly Flashback (01–07 February 2026) encapsulates the major developments under the Service Tax regime during the week, highlighting important judgments of the Supreme Court and various High Courts, key orders of the CESTAT, and significant clarifications, circulars, and departmental instructions impacting legacy service tax disputes.

This weekly roundup provides a concise yet comprehensive update on evolving legal interpretations, valuation and classification issues, exemptions, and transitional matters that continue to affect taxpayers and practitioners dealing with pre-GST service tax litigation.

Calcutta High Court

Service Tax on Logistics Services Depends on Substance, Not Labels: Calcutta High Court

The Calcutta High Court has clarified when activities amount to “Clearing and Forwarding” (C&F) services and the circumstances in which the extended period of limitation under Section 73 of the Finance Act, 1994 can be invoked for recovery of unpaid service tax.

CESTAT

Service Tax Paid By Partner In His Individual Registration Can Be Adjusted Against Tax Liability Of Partnership Firm: CESTAT

The Principal Bench of the Customs, Excise & Service Tax Appellate Tribunal (CESTAT), New Delhi, has held that service tax paid by a partner in his individual service tax registration can be adjusted against the tax liability of the partnership firm, setting aside a significant portion of the demand raised by the Department.

Tentative Appointment Registers Can’t Form Basis of Tax Assessment: CESTAT Quashes Rs. 262 Crore Service Tax Demand on Dermatology Services

The Customs, Excise & Service Tax Appellate Tribunal (CESTAT), New Delhi, has categorically held that tentative appointment registers (kachcha registers) cannot form the basis of tax assessment, and consequently set aside a Rs. 262-crore service tax demand raised against a Delhi-based clinical establishment operating under the brand name Medlinks.

Extended Limitation Inapplicable Where Tax Is Payable Under Reverse Charge: CESTAT

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Allahabad Bench, has set aside a service tax demand of Rs. 10.35 lakh along with interest and penalties raised against assessee holding that the extended period of limitation was wrongly invoked and that service tax liability under the reverse charge mechanism cannot be fastened upon the service provider.

CESTAT Allows Service Tax Refund on Head Office Services Used for Exports

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has ruled that service tax paid on input services used at a company’s head office or corporate office for export of goods is eligible for refund under Notification No. 41/2012-ST, as retrospectively amended by Notification No. 1/2016-ST.

CESTAT Dismisses Dept.’s Service Tax Appeal Against Angel Broking Citing to Low Tax Effect

The Mumbai Bench Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has dismissed the Service Tax appeal filed by the Revenue against Angel Broking Pvt. Ltd., holding that the appeal was not maintainable due to the low monetary value involved, in view of the Central Board of Indirect Taxes and Customs (CBIC) litigation policy.

Bank Credits and Admitted Receipts Can Be Treated as Taxable Service Value in Security Services Case: CESTAT

The Delhi Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has ruled that bank credits and receipts admitted by an assessee can be treated as taxable value for service tax purposes, even when the assessee claims that such amounts include non-service-related transactions.

Reimbursed Staff Expenses Not Taxable: CESTAT

The Chennai Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has set aside a service tax demand of over Rs. 6.6 lakh holding that reimbursed expenses received from a client cannot be included in the taxable value for service tax purposes.

CENVAT Credit Allowed on Construction-Related Services Used for Renting of Immovable Property: CESTAT

The Chandigarh Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has set aside a major service tax demand holding that CENVAT credit on inputs, input services and capital goods used for construction of immovable property is admissible when such property is used for providing taxable Renting of Immovable Property Service.

Adda Fees Collected at Bus Terminal Not Taxable as ‘Business Support Service’: CESTAT Chandigarh

The Chandigarh Bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that adda fees collected at the Amritsar bus terminal cannot be taxed as ‘Business Support Services’ under the Finance Act, 1994.

Services to Foreign Universities Are Export, Not Intermediary Services: CESTAT

The Chandigarh Bench of Customs, Excise and Service Tax Appellate Tribunal (CESTAT) has set aside service tax demands along with interest and penalties holding that services provided to overseas educational institutions do not qualify as “intermediary services” but amount to export of services.

Mutual Fund Investment Is Not an ‘Exempted Service’; CESTAT Quashes CENVAT Credit Demand

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), New Delhi, has set aside a service tax demand of over ₹1.70 crore, holding that subscription and redemption of mutual fund units cannot be treated as trading of goods or an exempted service, and therefore proportionate reversal of CENVAT credit is not required.

Service Tax Exemption on Road Construction Depends on Public Use: CESTAT

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), New Delhi, has remanded a service tax dispute involving a construction contractor to the adjudicating authority, holding that the key issue is whether roads constructed under a government work order were meant for use by the general public—a requirement for claiming exemption from service tax.