9911796707
TMI Blog2016 (12) TMI 230X X X X Extracts X X X X X X X X Extracts X X X X ..... e in hand is whether the appellant herein is required to discharge the service tax liability under the category of "Business Auxiliary Service" on amount paid by them to their purchaser situated abroad as deduction / commission on the sale of goods. Appellant herein entered into an agreement with M/s Duflon Europe Ltd. Europe (herein after referred to as DEL) for the sale of goods exported by them to the said DEL. The allegations in the show-cause notices are that appellant had paid commission to this entity DEL and recorded the same in their balance sheet as commission and such payment is liable to be taxed under the category of "Business Auxiliary Service" for the period 2004 to 09. Lower authorities after following due ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on the other hand submits that the invoices which has been raised by appellant on which reference / attention was drawn, indicates that they have paid commission to DEL; further it is submitted that it is very clear that commission which has been paid to overseas commission agent is taxable under reverse charge mechanism under "Business Auxiliary Service". He would submit that the service tax liability on appellant is liable to be confirmed for the period post 08.04.06 under Section 66A of the Finance Act, 1994. As there is no dispute that appellant has recorded the amount paid to DEL as commission paid from PLA account. 5. We have considered the submissions made at length by both sides and perused the records. 6. The en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... EL might purchase the goods from the appellant and sells the same in Europe. The reliance placed by learned D.R. and adjudicating authority on the clause of agreement that "DEL shall increase the market share of appellant's products" to conclude that DEL was a commission agent, seems to be erratic reading of the clauses of agreement and this itself does not amount DEL has been appointed as "commission agent". The amount indicated on the invoice and recorded in the accounts as commission, in our view, will not attract tax under reverse charge mechanism. We also find strong force in the contentions raised by learned Counsel that in order to tax this account as a commission, there has to be necessarily three parties, se ..... X X X X Extracts X X X X X X X X Extracts X X X X
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