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2016 (9) TMI 585 - CESTAT MUMBAI

2016 (9) TMI 585 - CESTAT MUMBAI - 2017 (47) S.T.R. 129 (Tri. - Mumbai) - Invokation of extended period of limitation - Demand - Evasion/short-payment of service tax - Business Auxiliary Service viz., airline incentives income - Held that:- the appellant is rendering services related to booking, preparation of bill, collection of realization by the appellant on behalf of the airlines which, in our view, would fall under the category of promotion and marketing of airline services. Inasmuch as the .....

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notice was issued on this issue and they were not adjudicated by the lower authorities. If that be so, the demand which is beyond the period of limitation from the date of issuance of the show cause notice in this appeal is hit by limitation while the demand within the limitation period in this appeal is liable to be upheld and confirmed. - Invokation of extended period of limitation - Demand - Evasion/short-payment of service tax - Business Auxiliary Service viz., net income earned as a fr .....

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ified by the decision of this very same bench in the case of Greenwich Meridian Logistics (India) Pvt. Ltd. [2016 (4) TMI 547 - CESTAT MUMBAI] and by a coordinate bench of this Tribunal in the case of DHL Lemuir Logistics Pvt. Ltd. Since the issue involved in this case is already decided against the Revenue, respectfully following the same we set aside the impugned orders in both the appeals as regards the demand raised and confirmed under this issue - Invokation of extended period of limita .....

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e collection fees to cover the cost of financial and banking cost associated with the freight liability paid by them. In any case, we do find that the appellant is not seriously contesting the tax liability under this head. In appeal ST/217/2012 the demand under this head which is beyond the period of limitation is set aside and demands within the limitation period are upheld. - Imposition of penalties - Held that:- the issue involved in this case is question of interpretation and the inter .....

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ical) Shri L. Badrinarayanan, Advocate with Shri Vinay Jain, Chartered Accountant for the appellant Shri Devendra Nagvenkar, Addl. Commissioner (AR) for the respondent ORDER Per M V Ravindran These two appeals are directed against Orders-in-Original Nos: 12/ST/SB/2011-12 dated 13/01/2012 and 18/ST/SB/2011-12 dated 31/01/2012 passed by the Commissioner (TAR), Central Excise, Mumbai. Since both the appeals are raise identical issue they are being disposed off by common order. 2. The relevant facts .....

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ice (BAS), business support service and transport of goods by road service. Investigation was carried out against the appellant for the evasion/short-payment of service tax for the various services rendered. After recording various statements, it was noticed by the department that during the period April 2004 to March 2009 appellant had not discharged correct service tax in respect of the services rendered by them. By coming to such a conclusion, a show cause notice dated 22nd April 2010 was iss .....

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ed 13/02/2012 confirmed the demands raised with interest and also imposed penalties. Against this order, the appeal filed is ST/217/2012. Subsequent show cause notice also issued within the limitation period for the very same demands and allegations which has been confirmed by the adjudicating authority by order-in-original dated 31/01/2012 which is contested in appeal ST/235/2012. 4. Learned Counsel appearing on behalf of the appellant submits that: 4.1. In respect of point of demand of service .....

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be taxed under business auxiliary service which has been negative by the Tribunal in the case of Greenwich Meridian Logistics (India) Pvt. Ltd. (supra) and DHL Lemuir Logistics Pvt. Ltd. v. Commissioner of Central Excise, Thane I 2016-TIOL-1455-CESTAT-MUM. 4.2. As regards the service tax liability on airline incentives income, it is his submission that the said airline incentive is in respect of the cargo which has been booked by the appellant on behalf of the appellant. The appellant, after bo .....

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lines as they are only booking the space in the airlines. He would submit that the decision of the Hon ble Supreme Court in the case of U P State Industrial Development Corporation [1997] 92 Taxman 45 (SC) and Kerala Publicity Bureau v. Commissioner of Central Excise 2008 (9) STR 101 (Tri.-Bang.) will be applicable and relies upon the decision for the proposition that the amounts which have been received by them from the airlines are incentives and hence not taxable under business auxiliary serv .....

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geable to only service tax after 10/09/2006. He would rely upon the decision of the Tribunal in the case of Bax Global India Ltd. v. Commissioner of Service Tax, Bangalore 2008 (9) STR 412 (Tri.-Bang.) and British Railways Board v. Customs and Excise Commissioners (1977) 221 STC for the proposition that service tax demand on the entire amount collected is not sustainable. 4.4. As regards the service tax demand on these issues in appeal ST/217/2012, it is the submission that the demand which is c .....

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ve, on the other hand, submits that the profits earned in trading of space in the shipping lines are the service rentals received from their customs. He would submit that the appellant books space in bulk in the shipping lines and trades in the same with the clients who want a particular space in the shipping line. It is his submission that this particular trading in space is nothing but rendering of service to the customers for the procurement of raw materials or in puts. He would also submit t .....

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of the airlines. It is his further submission that in respect of charge collection fees these are of charges for expenses incurred in respect of freight which are covered under the category of business auxiliary service. 6. We have considered the submissions made at length by both the sides and perused the records. The issue as stated by both the sides is regarding service tax liability on the appellant under the three different heads as putforth. We consider the three service tax demands indiv .....

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in advance with the shipping line, say for Rs. 100/- per sq. ft. and sells the space to any of the customers who would like to use the space at Rs. 115/- per sq. ft. The additional amount of Rs. 15/- earned by the appellant is being regarded by him as a profit in trading and selling of space. Revenue s contention is that this amount is for the services rendered to the client. In our considered view, the appellant herein, under this head, is not rendering any service either to the shipping line .....

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s Tribunal in the case of DHL Lemuir Logistics Pvt. Ltd. (supra). Since the issue involved in this case is already decided against the Revenue, respectfully following the same we set aside the impugned orders in both the appeals as regards the demand raised and confirmed under this issue. Airline incentive income: 6.2. On perusal of the records, we find that the airline incentive scheme is nothing but an amount given by the airlines to the appellant for rendering various services related to book .....

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on made by the Learned Counsel on this point and we hold on merits against the appellant on this issue. 6.3. As regards the question on limitation in appeal ST/217/2012, on this point we find that they have very strong case on limitation as there was a confusion which may arose on this point as it is a question of interpretation. It was also brought to our notice that earlier show cause notice was issued on this issue and they were not adjudicated by the lower authorities. If that be so, the dem .....

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