TMI Blog2014 (12) TMI 166X X X X Extracts X X X X X X X X Extracts X X X X ..... Notification 29/2005-S.T. for services rendered for transport of export goods by air. All these aspects are not considered while demanding tax on such charges. The deposits already made are sufficient for the purpose of Section 35F of Central Excise Act made applicable to appeals under Finance Act, 1994. So we grant waiver of pre-deposit of balance dues for admission of appeal. Appellant had not given adequate assistance to adjudicating authority in reconciling the figures appearing in the balance sheets and to explain the nature of services for which charges were being collected by them and also the charges which have been already included in the value of the services on which they have paid service tax. Since the applicants understand their accounts and returns better than the department it is their duty to explain the figures properly rather than argue that the Revenue has not been able to prove that consideration received is for non-taxable service or that on such consideration received tax has been paid under other heads. While making submissions for a fresh adjudication the appellant is directed to make full submissions in this regard. - Since there are basic flaws in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Period for which tax is demanded Service tax demanded 1. Commission received from airlines and discount or incentive of freight amounts Business Auxiliary Service Jul., 03 to Sep., 07 1,09,50,433 2. Miscellaneous Bills raised Business Auxiliary Service Sep., 04 to Sep., 07 4,57,65,485 3. Freight Charges for transportation by sea or air Business Support Service Apr., 06 to Sep., 07 13,55,90,863 4. Transportation of goods by Road Recipient of GTA services Jan., 05 to Sep., 07 51,62,653 In relation to SCN dated 24-4-2009 5. Freight Charges for transportation by sea or air Business Support Service Oct., 07 to Sep., 08 13,51,30,458 6. Handling Services, Agency services ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ice from 1-5-2006 when Business Support Service as defined under Section 65(104c) came into force. They have accepted liability from this date and have paid tax on such services. The applicants also contest that on some of the items they have already discharged liability under the categories of CHA services. Clearing and Forwarding Services and Business Auxiliary services. The contention of the applicants is that prior to 1-5-2006 the services could not be taxed under Business Auxiliary Services. 8. Service tax demand of 13,55,90,863/- and ₹ 13,51,30,458/- in the two show cause notices is confirmed on charges collected towards transportation of cargo by sea or by air. The Counsel for the applicant submits that this demand is basically on the amounts collected by them towards freight charges payable to the shipping lines or airlines for transportation of cargo. His argument is that there is no entry in the Finance Act, 1994 levying service tax on ocean freight. In the case of transportation of goods by air, there is an entry but liability to pay tax under this entry is on aircraft operator and no other persons like the present applicants is liable to pay such tax. 9. Ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er, name of the IATA agent, destination airport, gross weight of cargo, chargeable weight, rate/charge and the total freight charges. The freight rates are fixed by airlines. The assessee collect payments for the pre-paid transportation and other charges and remit the same to the airlines. For above services the airlines pay in the name of Commission, Discount, Incentives and Market Price Adjustment. This Business Auxiliary service includes the service provided by a person in relation not only to promotion, marketing of services but also incidental or auxiliary support services such as billing, collection or recovery of cheques, accounts and remittance etc. inasmuch as the assessees are providing various services such as marketing and canvassing for the cargo space, and other auxiliary support service as envisaged under BAS, I hold that the assessee are liable to pay service tax on the Commission, Discount and Marketing Price Adjustment under BAS w.e.f. 1-7-2003. 14. He submits that the appellant is not buying any space after paying consideration or with firm commitment for payment whether or not cargo is booked. The appellants are not authorized to sell the space at a price ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r examine with reference to terms of contract. 19. In the case of miscellaneous activities, the proposal was to tax it under Section 65(19)(iv) as it is existing after 10-9-2004 as seen from para 4.2 of the SCN. It is seen that in the impugned order the demand is confirmed under Section 65(19)(iv) as existing prior to 10-9-2004. 19.1 Different clause under Section 65(19)(iv) prior to 10-9-2004 (i) Promotion or marketing of sale of goods produced or provided by or belonging to the clients; or (ii) Promotion or marketing of service provided by the client; or (iii) Any customer care service provided on behalf of the clients; or (iv) Any incidental or auxiliary support service such as billing, collection or recovery of cheques, accounts, and remittance, evaluation of prospective customer and public relation services and includes services as a commission agent, but does not include any Information and Technology Service. 19.2 Clauses of Section 65(19)(iv) in force from 10-9-2004 (i) promotion or marketing or sale of goods produced or provided by or belonging to the client; or (ii) promotion or marketing of service provided by the client; or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deposit already made by the applicant is sufficient for the purposes of Section 35F of Central Excise Act. What we find is that the major component of demand to the extent of ₹ 27.06 crores is on account of airfreight charges and ocean freight charges. On this issue the Tribunal has granted waiver of pre-deposit of dues for admission of appeal for other persons similarly situated. The next major component is in respect of miscellaneous charges brought into tax net under Business Auxiliary Services. This demand is confirmed under Section 65(19)(iv) as it existed prior to 10-9-2004 whereas the proposal in the SCN was for demanding tax under Section 65(19)(iv) as it existed from the said date. Therefore the demand is confirmed without hearing the appellant on the issue whether the clause invoked will apply. Some of these items like Terminal Handling Charges, EDI charges, screening charges, etc., appear to be expenses incurred by the appellant on behalf of the clients which expenses are reimbursed by the clients. The question whether the amounts charged were actuals needs to be examined. The question whether these will form part of the value of services rendered by appellants als ..... X X X X Extracts X X X X X X X X Extracts X X X X
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