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2014 (12) TMI 169 - AT - Service TaxC&F Agent services - Business Auxiliary Services - Export of services - Cargo Handling services & Storage & Warehousing Services - Whether the Distribution fee/ Agency fee, received by MIPL from their foreign principal is liable for payment of service tax under the category of Business Auxiliary Services - Whether the benefit of saving in Ocean freight passed on by the principal to them is chargeable to service tax under the category of Cargo Handling Service - Whether the amount received by them towards customs clearances, port clearances and transportation should be considered as taxable service under the single head of clearing and forwarding Agent - Held that:- a service which has not been consumed in India, cannot be taxed in India. - Services rendered by the appellant under ‘Commission Sales Agreement’ and Non-exclusive Distributor Agreement’, pertaining to Distribution Fee/ Agency Fee, have to be considered as export of services and no service tax is leviable on such export of services. Following decision of M/s. GAP International Sourcing (India) Private Limited vs. CST [2014 (3) TMI 696 - CESTAT NEW DELHI] Saving in Ocean Freight - Amount is given to the appellant by the foreign principal as an incentive out of the freight saved by the principal. There is no service involved as the goods, for which facilities of appellant are availed, belong to the appellant. charging service tax there has to be a service provider and a service recipient. One cannot be held to be a service provider to one s own self. On the same issue of the appellant for a subsequent period adjudicating authority has dropped the demand. In view of these observations appeal of the appellant with respect to service tax on amount received from the principal on saving in ocean freight is required to be allowed. Demand of service tax on other activities - composit contract or not - Held that:- There is no evidence that the contract were artificially splited to avoid service tax. As the services are separate and service recipient in future could avail the services of a service provider from a service provider other than the appellant, therefore, it can not be held that all the independent and separate contracts represent a common composite contract. - Decided in favour of assessee.
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