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2015 (9) TMI 1280 - CESTAT NEW DELHI

2015 (9) TMI 1280 - CESTAT NEW DELHI - 2015 (40) S.T.R. 986 (Tri. - Del.) - Business Auxiliary Services - Benefit of Notification No.13/2003-ST, dated 20.6.2003 towards commission agent's services - Held that:- The notification exempts business auxiliary services provided by a commission agent. In other words, so long as the appellant provided business auxiliary services (even if such services did not strictly fall within the purview of the role of a commission agents) it was eligible for the be .....

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nal discourse unnecessary. - Impugned order is set aside - Decided in favour of assessee. - Service Tax Appeal No.551 of 2009 - Final Order No. 52857/2015 - Dated:- 10-9-2015 - Mr. G. Raghuram, President and Mr. R.K. Singh, Technical Member, JJ. For the Petitioner : Shri Arshad Hidayatullah, Senior Advocate with Shri Jitendra Singh, Advocate For the Respondent : Shri Ranjan Khanna, A.R. ORDER Per R.K. Singh: Appeal has been filed against Order-in-original dated 30.3.2009 in terms of which servic .....

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ouse on behalf of its clients. The primary adjudicating authority after scrutiny of the agreements which the appellant had entered into with its clients held that the appellant was providing Business Auxiliary Services and was not eligible for the benefit of Notification No.13/2003-ST, dated 20.6.2003 and accordingly confirmed the impugned service tax demand along with interest and penalty. As regards the demand pertaining to inadmissible Cenvat Credit the appellant is not contesting the same an .....

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ion was not that of a commission agent and therefore it was not eligible for the benefit of Notification No. 13/2003-ST. 5. We have considered the contention of both sides. We also perused a representative agreement that the appellant entered into with Konkan Agro Marine Industries (P) Ltd., Delhi in terms of which the appellant agreed to perform the under-mentioned functions: (a) To procure all orders independently and arrange for completion of necessary excise formalities /payment of excise du .....

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o register KAM under the local Sales Tax Act (LST) and also under the Central Sales Tax Act (CST). (g) To ensure compliance by KAM with various regulations of Local and Central Sales Tax Acts and Rules, COMMISSION AGENT agrees to maintain statutory records at the depot and also to attend to various functions/matters as mentioned in Annexure A. (h) To adhere to the general procedure of operation as described by KAM in Annexure B. (i) To maintain statutory and proper books of account and records, .....

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AGENT undertakes to invest/fund amount (required to be deposited for issue of Transport Passes to Trade/Institutions) at any point of time. Further COMMISSION AGENT undertakes to provide more funds (if mutually agreed) considering the growth in the volume or change in excise levies. 10. COMMISSION AGENT shall obtain such permissions, licenses and /or registrations and comply with such regulations as may be required from the Government/Local Bodies or any other Authority. 11. COMMISSION AGENT sha .....

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dministration of the Depot storage facilities and effecting sales/collections on KAMs account, KAM agrees to pay COMMISSION AGENT the brand wise fixed commission of ₹ 125/- per case on Smirnoff Vodka, Smirnoff Twist, Archers, Brakc & White and Vat 69 only and ₹ 35/- per case on Gilbeys Gln on total monthly sales, brand wise of each of the product (subject to condition of tax at source, if applicable under the Indian Income Act) on all sales effected from the Depot under this Agre .....

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ecessary in the public interest so to do, hereby exempts the business auxiliary services provided by a commission agent from the service tax leviable thereon under sub-section (2) of section 66 of the said Act. Explanation.- For the purposes of this notification, commission agent means a person who causes sale or purchase of goods, on behalf of another person for a consideration which is based on the quantum of such sale or purchase. 2. This notification shall come into force on the 1st day of J .....

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the consideration received by the appellant was based on the quantum of the goods sold. Therefore it satisfied the requirements of being categorised as commission agent as per the definition given in the said Notification. Though, admittedly, the appellant was rendering several other services also (all of which have been held to be covered under BAS by the adjudicating authority) that would not debar it from being called commission agent as the said Notification neither expressly nor impliedly .....

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e benefit of Notification No.13/2003-ST to the appellant essentially by noting as under: 21.2 However, if a service provider is primarily engaged in business promotion and sale is just a consequence of the various activities undertaken by him, it could not be considered that he is a commission agent primarily causing sale. The definition of commission agent in this notification would not cover a person who is primarily engaged in business promotion and not confined to sale of the goods. 21.3 How .....

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omotion rather they were mainly responsible for undertaking the aforesaid promotional activities. These activities are beyond the scope of the function of commission agent as defined in the notification. 21.4 Thus, the eligibility to the Notification is to be determined strictly in terms of the definition of commission agent provided in the Notification itself. This definition cannot be made wider by including activities which are not provided in the definition. 21.5 Thus, I hold that M/s BSL we .....

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