Relief for BHEL: CESTAT rules Reimbursed Freight Charges Not Taxable as Service, quashes ₹16 Cr...

CESTAT (Customs, Excise, and Service Tax Appellate Tribunal) has granted relief to BHEL (Bharat Heavy Electricals Limited), ruling that "reimbursed freight charges are not taxable as service," quashing a ₹1.6 crore demand. The tribunal clarified that when freight charges are merely reimbursed by a client to a service provider without any markup or profit element, they do not constitute consideration for a taxable service. This decision prevents the double taxation of such charges and provides significant clarity for businesses involved in large-scale projects with complex logistical arrangements.