SERTA/21/2025 of PRINCIPAL COMMISSIONER OF GST AND CENTRAL EXCISE, COIMBATORE Vs M/S RIYA TRAVEL AND TOURS INDIA PVT. LTD. on 14 October 2026

1. These appeals are filed under Section 35G of the Central Excise Act, 1944 read with Section 83 of the Finance Act,1994 against the order dated 25.09.2024 of the Customs, Excise and Service Tax Appellate Tribunal, New Delhi (hereinafter ‘the tribunal’).

2. For convenience, the facts are being taken from SERTA 21/2025.

3. On 19.10.2015, a show cause notice (for short ‘SCN’) was issued to the respondent for recovery of service tax on the services rendered as an air travel agent. The order-in-original (OIO) dated Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

30.05.2018 was passed confirming the demand raised in SCN. The respondent was successful before the tribunal and vide order dated 25.09.2024, the impugned demand was set aside. Hence, the present appeal was filed and the substantial questions of law proposed are reproduced below:- “a. Whether the amount of service tax retained by the 'agent' i.e. the Respondent, is recoverable under Section 73A(3) of Finance Act, 1994? b. When the commission received from the airlines by the ‘agents’ and some part of it is paused on to ‘sub-agents’ whether in this case the service is provided by sub-agents to agents in the head 'air travel agent services'? c. Whether the Ld. CESTAT is correct in holding that the Respondent has not provided any services to the Airlines? d. Whether the Ld. CESTAT is correct in holding that commission received by the Respondent from the airlines was not inclusive of service tax? e. Whether the Ld. CESTAT is correct in holding that the Respondent had provided services to the sub-agents and charging of Service Tax from the sub-agents was justified when the Respondent had paid/shared the commission received from the Airlines to the sub-agents? f. Whether the Respondent rendered air travel agent services to the airlines as contended by the department or the Respondent rendered this service to the sub-agents or customers as contended by the Respondent? g. Whether it is the Respondent that is providing service to the sub-agents are providing service to the Respondent? h. Whether the Respondent rendered any service to the airlines or services were rendered by the Respondent only to the subagents?” Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

4. Learned counsel for the respondent raises a preliminary objection that the department could not have preferred the appeals in view of the instructions dated 06.08.2024 as the amount involved is less than two crores.

5. Learned counsel for the appellant contends that the demand in dispute is less than two crores. The submission is that there are cascading effects of the issue involved in the appeals and hence the circular should not apply. Reliance is on the decision of the Supreme Court in the case of Commissioner of Income Tax v. Surya Herbal Limited (2011) 15 SCC 482 to contend that in case of a cascading effect, the circular ipso facto shall not apply. Reliance is upon the decision of the Gauhati High Court in the case of Central Goods and Service Tax v. M/s Pan Parag India Limited 2021 SCC OnLine Gau 2737 and the decision of Patna High Court in the case of Commissioner of Central Excise and Service Tax v. Indian Oil Corporation Limited Miscellaneous Appeal No. 376 of 2019 decided on 14.05.2026 to contend that the decision of the Supreme Court in Commissioner of Income Tax v. Surya Herbal Limited (supra) was followed by the High Courts in cases of Central Excise as well as under the Goods and Service Tax.

6. Before proceeding further, it would be relevant to reproduce the instructions issued by the Central Board of Excise and Customs (CBEC) dated 17.08.2011, 26.12.2014, 17.12.2015, 03.04.2018, 22.08.2019 & 06.08.2024.

Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

Instruction of CBEC dated 17.08.2011

Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

Instruction of CBEC dated 26.12.2014

Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

Instruction of CBEC dated 17.12.2015

Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

Instruction of CBEC dated 03.04.2018

Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

Instruction of CBEC dated 22.08.2019

Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

Instruction of CBEC dated 06.08.2024

Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

7. The instruction dated 17.08.2011 carved out two exceptions. The first where the validity of the provisions of an Act or Rule is under challenge and second where notification/instruction/order or circular has been held illegal or ultra vires.

8. On 26.12.2014, CBEC issued a clarification stating that the monetary limits for filing appeals would apply to cases of a recurring nature and appeals in such cases would not be filed, except in two Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

cases specified in the circular dated 17.08.2011. It was further clarified that despite pending appeals in the higher appellate forums subsequent case of the same party or other party shall not be pursued if it falls below the prescribed monetary limit.

9. The instructions dated 17.12.2015 partially modified the instructions dated 17.08.2011 by adding one more exception in paragraph 3 relating to classification and refunds issues of a legal and/or recurring nature.

10. By the instructions dated 03.04.2018, sub-clause ‘c’ of paragraph 3 of the instructions dated 17.08.2011 which operated as an exception to the general monetary limits was withdrawn.

11. By the instructions dated 06.08.2024, the monetary limits were enhanced. The two exceptions provided in the instructions dated 17.08.2011 were retained and it was clarified that except for the modification to the monetary limits, all other terms and conditions of the instructions dated 17.08.2011 stand.

12. From the instructions quoted above, it is clear that the vires or validity of the provisions of the Act or Rule or notification/instruction/order or circular are the only exception for filing the appeal below the prescribed monetary limit. It is an admitted fact that the dispute in these appeals involves neither the validity of any provision nor of circular/notification/instruction.

13. The reliance placed by learned counsel for the appellant on the decision of the Supreme Court in Commissioner of Income Tax v. Surya Herbal Limited (supra) is of no avail. The case was with regard Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

to circular issued by the CBDT for filing appeals under the Income Tax Act, 1961. The issue of applicability of circular was not decided, only liberty was granted to the Income Tax Department to approach the High Court to point out that there is a cascading effect and that the circular ipso facto would not apply.

14. In the case of Central Goods and Service Tax v. M/s Pan Parag India Limited (supra), the department relied upon the decision of the Supreme Court in Commissioner of Income Tax v. Surya Herbal Limited (supra) to contend that the instructions would not apply where there is a cascading effect and a common principle may be involved in a subsequent group of matters or a large number of matters. Reliance was placed by the department on instructions dated 22.08.2019, it is by this instruction the monetary limits were increased. Clause 4 of the instructions dated 22.08.2019 stated that the substantial questions of law as described in paragraph 1.3 of instructions dated 17.08.2011 would be contested irrespective of the monetary limit. On perusal of the instructions dated 17.08.2011, it is evident that there is no paragraph 1.3. The reference in clause 4 of the instructions dated 22.08.2019 is in fact to paragraph 3 of the instructions dated 17.08.2011 which provides only two exceptions as discussed above and no exception for cascading effects or bunch matters is there.

15. With due respect we are not in concurrence with the view taken by the Gauhati High Court.

16. The department made another attempt to rigour out of the Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

SERTA 21/2025 & connected matters

instructions issued before the Patna High Court in Commissioner of Central Excise and Service Tax v. Indian Oil Corporation Limited (supra) contending that the issue of a recurring nature had to be entertained irrespective of the amount involved as mentioned in the instructions. The same argument is made before this Court.

17. The department failed to bring to the notice of the Patna High Court that the instructions dated 17.12.2015 were withdrawn by the instructions dated 03.04.2018, with effect from 03.04.2018.

18. The monetary limits for filing an appeal prevailing as on date are Rs. 60 lakhs before the CESTAT, Rs.2 crores before the High Court and Rs.5 crores before the Supreme Court. The two exceptions being:

(i) Challenge to the constitutional validity of the provisions of an Act or Rule.

(ii) Challenge to the notification/instructions/order or circular held to be illegal or ultra vires.

19. Before concluding we would be failing if we do not appreciate the efforts put by learned counsel for the appellant to assist the court on instructions and circular.

20. The department, if it deems appropriate, should take up this matter with the Board/Secretary to ensure uniform implementation of the instructions and circular. It is noticed regularly, that Commissionerate’s are filing appeals despite the binding instructions issued with an object to reduce litigation. Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified

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21. The present case does not fall in any of the exceptions. The appeals are dismissed as not maintainable. The substantial questions of law proposed are kept open. All pending applications are also disposed of.

AVNEESH JHINGAN, J

SHAIL JAIN, J OCTOBER 14, 2026 ‘JK’

Reportable: Yes Signed By:CHANCHAL Signing Date:27.10.2026 15:16:37 Signature Not Verified