TMI Blog2016 (4) TMI 547X X X X Extracts X X X X X X X X Extracts X X X X ..... therefore, be looked at independently. The appellant takes responsibility for safety of goods and issues a document of title which is a multi-modal bill of lading and commits to delivery at the consignee's end. To ensure such safe delivery, appellant contracts with carriers, by land, sea or air, without diluting its contractual responsibility to the consignor. Such contracting does not involve a transaction between the shipper and the carrier and the shipper is not privy to the minutiae of such contract for carriage. The appellant often, even in the absence of shippers, contract for space or slots in vessels in anticipation of demand and as a distinct business activity. Such a contract forecloses the allotment of such space by the shipp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gistics (I) Pvt Ltd is in appeal against order-in-original no. 9/ST/SB/2011-12 dated 10 th January 2012 and order-in-original no. 19/ST/SB/2011-12 dated 31 st January 2012 which have confirmed tax demand of ₹ 2,27,02,697/- for the period 2005-06 to 2009-10 and ₹ 48,43,493/- for 2010-11 respectively with interest thereon as provider of business auxiliary service.' The adjudicating authority has also imposed penalty under section 76, 77 and 78 of Finance Act, 1994 in the former and under section 76 and 77 of Finance Act, 1994 in the latter. As the issue in dispute in the two appeals is identical we dispose both by this common order. 2. The appellant handles the logistics of exporters for delivery to the consignee and is re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that were booked on ships according to instructions from exporters. Convinced of this, and further taking note of the accounting entries at various stages before booking it as profit, the original authority recorded the inference that the appellant had carried out activities that were intended to promote the marketing of the services of the client which was taxable as business auxiliary service'. Consequently, it was held that surplus of ₹ 21,95,34,602/- was liable to tax. 5. We have heard both sides and given due consideration to various submissions canvassed on behalf of the disputants. Learned Counsel for appellant contends that this amount is a profit from trading, that Finance Act, 1994 taxes certain services and not pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gards all the other activities, we find that they do not relate to customs house agent activities. Even if any profit has been made in respect of those activities, they cannot be subjected to service tax in view of those activities, they cannot be subjected to service tax in view of the Apex Court decision in the Baroda Electricity Meters Ltd. case . 7. Each source of income must, therefore, be looked at independently. A service provider is not necessarily a specialist in rendering one service; the earnings of a service entity may accrue from one or more services - some of which may be taxable. Finance Act, 1994 does not envisage determination of taxability from accounting entries. The manner or mode of booking the profit in the accoun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the provision of service is manifest by the existence of service provider performing an activity for which consideration is received from the recipient of the service. A finding on these aspects is distinctly absent in the impugned order. 10. The original authority has proceeded on the assumption that there is only one payment and, that too, for freight charged by the shipping line. He has rejected the possibility of trading in space or slots on vessels by holding that trading in space or slots is a figment and freight is all that is transacted. Freight, though used colloquially to describe all manner of carriage, is the nomenclature assigned to the consideration for space provided on a vessel for a particular voyage. Freight is charged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s end. To ensure such safe delivery, appellant contracts with carriers, by land, sea or air, without diluting its contractual responsibility to the consignor. Such contracting does not involve a transaction between the shipper and the carrier and the shipper is not privy to the minutiae of such contract for carriage. The appellant often, even in the absence of shippers, contract for space or slots in vessels in anticipation of demand and as a distinct business activity. Such a contract forecloses the allotment of such space by the shipping line or steamer agent with the risk of non-usage of the procured space devolving on the appellant. By no stretch is this assumption of risk within the scope of agency function. Ergo, it is nothing but a p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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