TMI Blog2009 (7) TMI 518X X X X Extracts X X X X X X X X Extracts X X X X ..... nly arranged for receipt, storage and sale of the lubricants on behalf of principal, thus the demand is not sustainable. - ST/151/2006 - ST/259/2009 - Dated:- 20-7-2009 - D.N. PANDA, JUDICIAL MEMBER AND RAKESH KUMAR, TECHNICAL MEMBER Ms. Asmita Nayak for the Appellant. Sunil Kumar for the Respondent. ORDER D.N. Panda, Judicial Member - Ld. Counsel Ms. Asmita Nayak submits that the appellant had agreement with BPCL for storage of lubricants of that concern. There was no clearing activity carried by the appellant to fall under the category of Clearing Forwarding services. She has relied upon page No. 17 to show that the agreement was between BPCL and the appellant. She submits that even though payments were linked to qua ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch they rely, have proceeded against the appellant to issue SCN and made adjudication. So also first appellate order was passed. Once the document is not identifiable that is not readable in a quasi-judicial proceeding. Law requires that courses of natural justice is followed to bring all the identified cogent material for rebuttal. When we find that entire proceedings has suffered from above legal infirmity, the appellant should succeed. Accordingly, we allow the appeal. 4. Rakesh Kumar, Technical Member - While agreeing with my learned brother's finding that the authorities have not examined the invoices issued by the Appellants for ascertaining the nature of their service as discussed below, I am of the view that from the Appellant's ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... llant for sale ex-godown is taken in the name of BPCL at the prevailing general trade rate; (iii) all cheques/DDS received during the day will be deposited in BPCL's account with SBI, Main Branch, Bhilwara on the same day or at the most, the next day; and (iv) Appellants are to maintain an account of receipt of lubricants at the godown and sale as per the procedure advised by BPCL; (e) Clause 19 of para 2 of the agreement mentions the rate of remuneration to the Appellant, which is dependent upon the Appellant achieving a certain minimum volume of sale per month; and (f) Clause 30 of para 2 mentions that if the minimum assured offtake of 40 kl. per month is not achieved, BPCL could be free to terminate this agreement. 5.1 From the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er orders received from Principal or owners, arranges transport etc., for the purpose and prepares invoices on behalf of the Principal. For this service, the C F Agent receives Commission on the basis of agreed terms. Therefore, an essential characteristic of any services, to fall in the category of C F Agent, is that the relationship between the service provider and the receiver should be in the nature of principal (owner) and agent. The C F agent carries out all the activities in respect of goods right from the stage of their clearance from the premises of the principal to its storage and delivery to the customers." 6.1-1 The Board vide Clarification No. 2/1/02-ST, dated 24-4-2002 issued under section 37B of the Central Excise Act, 1944 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, has held that mere procuring or booking orders for the principals by an agent on payment of commission basis would not amount to providing "C F Agents' service" within the meaning of definition of this expression on section 65(25) of the Finance Act, 1994. Applying the ratio of the judgment, it can be said that the activity of mere sale of goods on behalf of the Principal, would not be covered by the definition of C F Agent's service. The C F Agents are involved in movement/distribution of the goods as per their Principal's directions and sale of goods or procuring orders for sale of goods on behalf of their principals is not their main activity, while a Commission Agent, covered by the definition of "Business Auxiliary Service" is invol ..... X X X X Extracts X X X X X X X X Extracts X X X X
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