TMI BlogScope of taxable service of "Clearing and Forwarding Agent's service" under the provisions of "Service Tax"X X X X Extracts X X X X X X X X Extracts X X X X ..... Scope of taxable service of "Clearing and Forwarding Agent's service" under the provisions of "Service Tax" - Commentaries / Editorials Dated:- 23-4-2009 - News - Relevant Reference: Clearing and forwarding Agent (C F) = Taxable Services Finance Act, 1994 - "Service Tax" Service Tax Rules, 1994 Section 96C - Application for Advance Ruling Section 65(105)(j) - Taxable Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rvice of C F Section 66 - Charging Section Section 70 - Furnishing of Service Tax Return Section 77 - Penalty Rule 7 - Half Yearly Return Circular No. 2/1/2002-ST dt 20.4.2002 Honorable High Court of Pubjab and Haryana defines the scope of C F agent's service as: [Commissioner of Central Excise, Panchkula Versus M/s Kulcip Medicines (P) Ltd. - 2009 -TMI - 33117 - PUNJAB ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... AND HARYANA HIGH COURT] Facts of the Case: The assessee- respondent entered into an agreement with M/s Cipla for handling and distribution of their products and were entrusted with the job of receiving, storing and distributing Cipla products to their authorised stockists and distributing centres. For the service so rendered, the assessee- respondent was entitled for commission based on agr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eed percentage of sales figures and also for reimbursement of recurring expenses. The Question: "Whether a person (agent) who has entered into an agreement with principal (owner) for handling and distribution of the products of the principal and entrusted with the job of receiving, storing and distributing the products of the principal to his authorised stockists and distributing centers is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... liable to pay Service Tax under the category of 'Clearing and forwarding Agent" when no clearing activity from the manufacturer's (Principal) premises is directly undertaken by the agent or Service Tax is leviable under the category "Clearing and forwarding" only if an agent renders both clearing forwarding services." Decision We have not been able to understand with utmost respect to the Tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ibunal as to what is 'Orchestrated nature of work' involved in the present transaction. The dealer in the present case as per the arrangements reached between the parties has to receive goods which are already got 'cleared' by the manufacturer. The dealer is to store those goods and forward to the buyer of the goods as per direction received. In that regard the findings of the Tribunal in the inst ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ant case is patently clear when it observed as under in para 6 : "It is clear from the terms of the agreement that appellant herein does not attend to the clearing of the medicines manufactured by Cipla. Consignments of medicines are cleared from the factory by the manufacturer and delivered to the appellant at his premises. In this factual situation, it has to be held that there is no Clearing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the appellant and for that reason, the service rendered by the appellant does not satisfy the requirement of clearing and forwarding. We, therefore, are of the view that the demand is not sustainable. To the same effect is our earlier decision in the case of M/s Mahavir Generics" The example of 'wheat and rice' grocery shop is obviously wholly mis-appropriate and does not fit in the context. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... We are also not in agreement with the interpretation of word 'and' which has already been dilated upon by us. As a sequel to the above discussion, the question of law raised is decided against the revenue and in favour of the assessee. [Commissioner of Central Excise, Panchkula Versus M/s Kulcip Medicines (P) Ltd. - 2009 -TMI - 33117 - PUNJAB AND HARYANA HIGH COURT] - News - Press rele ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase - PIB Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
