TMI Blog2008 (4) TMI 31X X X X Extracts X X X X X X X X Extracts X X X X ..... 24-4-2008 - S.B. Sinha V.S. Sirpurkar JJ. P.K. Sahu and Radha Shyam Jena, Advocates, for the appellant. Gopal Subramanium, Additional Solicitor-General of India (Asheesh Jain and B. Krishna Prasad, Advocates with him) for the respondent. JUDGMENT: S.B. Sinha, J. 1. Short question arising in the appeal is whether in the facts and circumstances of this case, the petitioner renders any services so as to incur the liability to pay service tax. 2. The factual background leading to the said question may briefly be noticed. Appellants herein entered into an agreement with Gas Authority of India Ltd. (GAIL) titled 'Consignment Stockistship Agreement'. 3. Inter alia, on the premise as to why they should not be asked to pay ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itor General appearing on behalf of the Respondent, on the other hand, would contend that a document must be read as a whole. So read, it would appear that the appellant not only receives orders on behalf of GAIL but also gets the insurance cover for the goods and sale of the goods which would clearly come within the purview of clearing and forwarding activities. Such activities on the part of the appellant, it was urged, being not incidental to the main purpose for which it was appointed as a stockist agent, the impugned judgment cannot be faulted. 7. Before we embark upon the rival contentions of the parties, we may notice the definition of 'clearing and forwarding agent' as also 'business auxiliary service' as contained in Section 65 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e purport and object with which the parties thereto entered into a contract ought to be ascertained only from the terms and conditions thereof. Neither the nomenclature of the document nor any particular activity undertaken by the parties to the contract would be decisive. 9. In V. Lakshmanan v. B.R. Mangalagiri and Ors. [1995 Supp.(2) SCC 33] , the Supreme Court in regard to interpretation of the clause stipulating the payment of money as advance and not earnest money provided for in the Sale Deed opined : "The nomenclature or label given in the agreement as advance is not cither decisive or immutable." 10. In Assam Small Scale Ind. Dev. Corp. Ltd. and Ors. v. J.D. Pharmaceuticals and Anr. [2005 (8) SCALE 298 = (2005) 13 SCC 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted 15.2.2005, inter alia, noticed : "During the appeal no one appeared for personal hearing fixed on 12.7.2004 and 20.7.2004. Therefore, I am going to decide the case on the basis of evidence available on records. I have carefully gone through the facts and records of the case and observe that the issue involved is non-payment of Service Tax by the appellant. The appellant has contended that levying of Service Tax on amount received as commission for procuring orders for another person is not legal. Under Section 65(25) "C F Agent" has been defined as any person who is engaged in the providing any service, directly or indirectly connected with clearing and forwarding operation in any manner to any other person and "C F agent" inclu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pined : "In this context, a plain reading of Section 65(105)(j), would reveal that 'Taxable Service' should mean any service provided to a client by a clearing and forwarding agent including a consignment agent (Emphasis supplied) in relation to clearing and forwarding operations, in any manner. In the present case, the appellant is admittedly a consignment stockist, who is actively involved in "Clearing Forwarding Operation" by taking responsibilities for the movement of goods right from the factory/warehouse of the principal upto the stage of delivery to the buyers in one or many ways. There is, therefore, no doubt, that the appellant is fully covered within the tax framework, being a "Clearing Forwarding Agent" engaged in relatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld by them. (ii) Rs.400/- PMT shall be paid to the consignment stockist for getting/booking orders for the product of M/s. GAIL. (iii) Rs.100/- PMT shall be paid to the consignment stockist for release/clearance of product locally from their stock on the orders booked by M/s. GAIL directly." 19. The period in question is from 1.9.1999 to 31.7.2002. The notice to show cause had referred only to paragraph 20.1 and 20.3 of the agreement. Its activities are said to be sale and/or getting booking orders for the product. 20. Whether in the aforementioned situation, the appellant has incurred any liability to pay service tax or not has not been determined. Its principal activities, as indicated hereinbefore, have not been determined. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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