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TMI Blog2013 (8) TMI 803X X X X Extracts X X X X X X X X Extracts X X X X ..... deducting the expenses as also their commission along with F form of Rajasthan Sales Tax. 2. During the course of adjudication the appellant submitted that they were only acting as commission agents for their principals inasmuch as the tea in question is being sold by them under their own invoices and to the independent buyers of their choice. Unlike Clearing and Forwarding agents they are not directed by the principals to raise the invoices to the principals customers. In such a scenario, they cannot be held to be a clearing and forwarding agent but are simply selling the tea on commission basis. 3. The above stand of the appellant was not accepted by the lower authorities who confirmed the demand and also imposed penalty. On appeal, the said order of the adjudicating authority was upheld. Hence, the present appeal. 4. For better appreciation, we reproduce the submissions made by the appellant before Commissioner (Appeals) and as detailed by him in the impugned order : "(i) that the moot question is whether the activities of appellant fall under 'commission agent' or 'consignment agent'. (ii) that the service of 'commission agent' is included in the definition of 'Business A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... means 'the act of consigning; the things consigned: a set of things consigned together'. A consignment agent thus acts as intermediary between the seller and the purchaser, receiving the goods from the seller (the consignor) on behalf of the purchaser (the consignee) and then transmitting the goods to the purchaser. (iv) that Section 65(105) defines taxable service. Under sub-clause (j) taxable services of clearing and forwarding agent' is defined as under :- "Section 65(105). 'taxable service' means any service provided - (j) to a client, by a clearing and forwarding agent in relation to clearing and forwarding operation in any manner." The definition of taxable service provides that services provided by a clearing and, forwarding agent in relation to clearing and forwarding operation are taxable. Since the 'Consignment agent' is included in the definition of clearing & forwarding agent and thus where a consignment agent provides any service in relation to clearing and forwarding operation, then only it is taxable under this category. Mere consignment sales cannot be taxed under this category. The department has also clarified that 'since the consignment agent provide service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nbsp; The goods are being sold at the rate decided by appellant which is finalized after mutual discussion/bargaining with customer. Appellant have full liberty to sell the goods to any of the customer at rate decided between them. There is no influence/control of principal companies in this matter. f. Appellant sells goods to various customers/parties. The goods are generally sold on ex-godown/ex-shop price. For local transportation of goods from godown to the office of transport company cartage is being charged from the customer in the sale bill. The freight is being paid by the respective customers. There is no control of appellant as well as of principal company over dispatch of goods. Neither principal companies issue any direction, nor any transporter is authorized by them nor appellant pays the freight. g. For the goods sold to customers appellant prepare invoice on their own bills. Sales tax is charged from the customers by the appellant and is deposited with the sales tax department. h. The realization from debtors is being made by appellant at their own level. & ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... performed by the appellant cannot be treated as 'Consignment agent' rather it is of the nature of 'commission agent'. Thus the appellant does not perform the activities specified by the department in case of a C&F." 5. On appreciating the submissions made by both sides, we find that sole question required to be decided in the present appeal is as to whether the appellant can be held to be clearing and forwarding agent of their principals. The appellants have categorically stated that they have been selling their tea under their own invoices on which sales tax was being paid by them. They have also relied upon the Board's Circular No. 43/07/97-TRU, dated 11-7-1997 clarifying that Clearing and Forwarding agents are receiving despatch orders from the principal and arranging despatch as per directions of the principals. The Commissioner (Appeals) while assailing the above stand of the appellant have observed that it is not essential for a person to cover in the ambit of clearing and forwarding agents to perform all those activities as specified by Board and even if one or two of such activities are not performed by such person, he cannot be debarred from the definition of clearing and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f. 10-9-2004, they would be eligible for exemption under Notification No. 13/2003-S.T. as amended by Notification No. 8/2004-S.T., dated 10-9-2004 had not been considered by the Commissioner (Appeals), for this purpose the matter will have to be remanded to Commissioner of Central Excise (Appeals). However if service tax is chargeable on the Appellant's service by treating the same as Business Auxiliary Service, in view of the circumstances of the case, longer limitation period would not be applicable and service tax would be demandable only for normal limitation period. For the same reason, penalty under Section 76 and 78 would be liable to be waived under Section 80 and as such no penalty would be imposable. 8. In view of the above discussion, while setting aside the impugned order and holding that the service provided by the Appellant is the service of Commission agent included in the definition Auxiliary Service, we remand the matter to Commissioner of Central Excise (Appeals) for :- (a) examining the Appellant's plea regarding eligibility for exemption under Notification No. 13/2003-S.T., dated 1-3-2003 as amended by Notification No. 8/2004-S.T., dated 10-9-2004 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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