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2023 (5) TMI 192 - AT - Service TaxLevy of Service tax - ocean cargo / air cargo freight income, as received by appellant as marked up charges - Business Auxiliary service or not - Brokerage and special commission/incentive - penalty - Extended period of limitation. Ocean cargo / air cargo freight income, as received by appellant as marked up charges - Business Auxiliary service or not - HELD THAT:- The issue has been addressed in the decisions of this Tribunal itself specifically in the case of DHL Logistics (P) Ltd. vs. Commissioner of Service Tax, Mumbai [2017 (8) TMI 600 - CESTAT MUMBAI]. It has been held that the freight rebate is a revenue stream generated out of trading of the space in the airline incentives. Unless the space is booked by the appellant specifically for a client the components of the Business Auxiliary Service do not come into play. In the instant case, there is no such allegation and the appellants are booking the space for their own trading activities. In these circumstances demand of service tax under BAS cannot be sustained and the same is set aside. Brokerage and special commission/incentive - to be an income received in the activity of trading of freight space in various shipping lines, or not - HELD THAT:- Reliance placed in the case of Karam Freight Movers [2017 (3) TMI 785 - CESTAT NEW DELHI] where it was held that The surplus earned by the respondent arising out of purchase and sale of purchase and sale of space and not by acting for client who has space or not on a vessel. It cannot be considered that the respondents are engaged in promoting or marketing the services of any “client.” - demand do not sustain. Penalty - Extended period of limitation - HELD THAT:- It is observed to be an apparent fact that the appellant was otherwise discharging the liability for providing the chargeable services and was admittedly filing the regular ST-3 returns. Once it is held that there was no liability upon the appellant to be discharged as far as the markup charges are concerned there remains no reason with the Department to invoke the extended period of limitation while issuing the impugned Show Cause Notice. For want of intention to evade duty there can be imposed no penalty upon the appellant. Appeal allowed.
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