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2012 (11) TMI 450 - CESTAT MUMBAIBusiness Auxiliary Service - denial of Notification No.13/2003-ST - service tax demand with interest thereon and penalties - Held that:- Persuing the Management Agent agreement entered into by the appellant with the principal the appellant is required to display, stock and sell jewellery products to the customers through showrooms managed and operated by the agent on stock transfer basis with the design, maintenance and operation of the showrooms undertaken as per the directions of the principal and the insurance cover for the showroom has to be provided by the agent. There is also condition that the agent shall manage and operate or deal in the showroom only the products supplied by the principal company and shall not deal with any other products in the showroom except with the prior written consent of the principal. Even the bills raised for the sale of the products should be in the principal's name. In consideration for services rendered, the agent is entitled to receive a management fee based on the turn over achieved by him on a slab basis Thus from the tenor of the agreement, it is absolutely clear that the appellant is not a mere commission agent as envisaged in the Notification No.13/2003. The appellant is not merely acting as a Commission Agent but does something much more than that i.e., designing, managing and operating a showroom, receiving goods on stock on transfer basis, undertaking sales promotion activities and collecting the sale proceeds on behalf of the principal. These activities do not come within the purview of Commission agent as defined in the notification No.13/2003 - against assessee.
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