CESTAT sets aside Service Tax Demand on Trade Discount by Auto Dealers

The Customs, Excise, and Service Tax Appellate Tribunal (CESTAT), Delhi Bench, ruled that service tax is not payable on trade discounts received by automobile dealers from manufacturers. In the case of M/s Divine Autotech Private Limited, the appellant, involved in selling Renault cars, the tribunal concluded that the amounts received as trade discounts cannot be subjected to service tax, thereby setting aside the service tax demand previously levied on such amounts.