TMI Blog2014 (10) TMI 284X X X X Extracts X X X X X X X X Extracts X X X X ..... nt as the transportation was undertaken not as part of C&F agency functions but independently of the said function and, therefore, the question of including the expenditure incurred on freight in the consideration received is clearly unsustainable in law. As regards the reimbursement towards statutory levies such as octroi, we have seen the invoices and it is clear from these invoices that the statutory levies are on the service recipient, and the appellant has paid these charges and got it reimbursed from the service recipient. Here also, the appellant has acted as a pure agent and, therefore, these costs are also not includable for the purpose of levy of service tax. As regards DFC unloading charges, the said charges are for transpo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kar, Addl. Commissioner (AR) JUDGEMENT Per: P R Chandrasekharan: The appeal is directed against Order-in-Original No: 15/P-III/STC/COMMR/2008-09 dated 23/12/2008 passed by the Commissioner of Central Excise, Pune - III. 2. Vide the impugned order, the learned adjudicating authority has confirmed a service tax demand of ₹ 58,91,811/- along with interest thereon against the appellant, M/s. Pharmalinks Agency (I) Pvt. Ltd. and also imposing equivalent amount of penalty under Section 78 of the Finance Act, 1994. Aggrieved of the same the appellant is before us. 2.1 M/s. Pharmalinks Agency (I) Pvt. Ltd. entered into a C F agency agreement and also a warehousing service agreement with M/s. Abbot India Ltd. The warehousin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on actual basis based on the transporter's bills and they were reimbursed these charges by M/s. Abbot India Ltd. Thus, the appellant was acting as a pure agent for payment of transportation charges and, therefore, these reimbursements towards freight cannot be considered as part of consideration received from C F Agency services. 3.1 Similarly, the appellant also incurred octroi, sales tax and licence fees on behalf of M/s. Abbot India Ltd. which they got reimbursed. These payments are statutory in nature and the payments have been made on behalf of M/s. Abbot India Ltd. and therefore, these charges do not form part of the consideration received for rendering C F Agency services. 3.2 As regards the DFC unloading charges, the expe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ider on behalf of service recipient, the question of reimbursing the expenses incurred on behalf of the recipient shall arise. Accordingly, it was held that the question of levying service tax by including reimbursements in the assessable value would not arise. Similarly, in the case of J. Walter Thompson vs. Commissioner of Central Excise, Mumbai 2014 (33) STR 525 it was held that the issue whether the reimbursable expenses to be included in the assessable value of service was settled by the larger bench of this Tribunal in the case of Sri Bhagavathy Traders (supra) and prior to that there were divergent views. In these circumstances, the demand beyond the period of normal limitation is not sustainable. Accordingly, it is prayed that the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w. 5.2. Similarly, as regards the reimbursement towards statutory levies such as octroi, we have seen the invoices and it is clear from these invoices that the statutory levies are on the service recipient, and the appellant has paid these charges and got it reimbursed from the service recipient. Here also, the appellant has acted as a pure agent and, therefore, these costs are also not includable for the purpose of levy of service tax. 5.3 As regards DFC unloading charges, the said charges are for transportation of the goods from the premises of the loan-licensee of Abbot India Ltd to the appellant's warehouse and it has no relation with the C F agency agreement between the appellant and M/s. Abbot India Ltd. Therefore, the quest ..... X X X X Extracts X X X X X X X X Extracts X X X X
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