The government has slapped demand notices amounting to about Rs 77 crore on nine companies, including soft drinks major Coca Cola India, German airline Lufthansa and Era Infra Engineering for evading service tax.
The Anti Evasion Wing of the Commissionerate of Service Tax slapped demand notices on soft drinks major Coca Cola India and German airline Lufthansa for service tax evasion, totalling around Rs 15 crore.
Besides Coke and Lufthansa, the wing also issued notices to seven other companies, including a tax demand for Rs 35 crore on construction company Era Infra Engineering Ltd.
Coca Cola was issued a Rs 8.55 crore demand notice on non-payment of service tax on the "out of pocket expenses," the service tax commissionerate said.
Out of pocket expenses include expenses over and above the contract amount, which is not inclusive of reimbursements for man and machinery supplied during providing consultancy or other services.
Similarly, German carrier Lufthansa has been issued a Rs 6.16 crore demand notice for evading service tax on the full value of fare received by the airline. According to the service tax commissionerate, Lufthansa had not paid service tax on the full fare received in the category, "passenger embarking by air in India for international journey in a class other than economy class".
An official handling the case said that the total fare for a passenger to travel by air is divided into about five to ten categories by airlines where the basic fare is just a small part of the total fare value. He, however, did not specify the period for which the tax notice was slapped.