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TMI Blog2017 (3) TMI 942X X X X Extracts X X X X X X X X Extracts X X X X ..... engaged in the manufacturing of Pepsi range of products such as Pepsi, Mirinda, Mountain Dew, 7-up, Slice, Aquafina and fruit juices; is a franchisee of M/s. Pepsi Foods Pvt. Ltd. and is also engaged in trading of Pepsi brand products like Slice, Nimboo, bottle and cans of Pepsi, Mirinda Orange, 7-up and Mountain Dew. The traded items are purchased from M/s. Pepsico India Holdings Pvt. Ltd. The main appellant purchased concentrate i.e. basic raw material from I. Officers of the department visited the premises of the main appellant and scrutinized the records and found that in the balance sheet, appellant is showing additional income under the head Net Incentive and Support of other receipts . On further enquiry, the departmental officers f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt, which is further used in the manufacture of various aerated products of Pepsi brand; the aerated water is only sold by the main appellant to various distributors and a perusal of the documents reveals that the relationship between the main appellant and PFL is on principal to principal basis; it is an outright case of purchase of concentrate from PFL and various amounts received by the main appellant cannot be said to be towards the sale of concentrate which is being purchased; the sale of concentrate by PFL to the main appellant is on payment of central excise duty, VAT and other taxes and there is no element of any service which has been provided by the main appellant to PFL, hence there cannot be any levy of service tax on the amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... II 2016 (42) STR 329 (T). On limitation, it is his submission that the department was aware of the activity of the main appellant as they were manufacturers of excisable products and the records were audited. It is his submission that on limitation as well as on merits, the issue is squarely covered in their favour. 4. Learned departmental representative, on the other hand, would draw our attention to the various clauses of Bottling Appointment and Trade Mark Licence Agreement entered into by the main appellant with PFL. He would draw our attention to the extracts produced from the said agreement in the order-in-original and submit that the said agreement specifically in para 11(b) records that the main appellant shall take all steps neces ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the main appellant. 5. We have considered the submissions made at length by both sides and perused the records. 6. We find that it is undisputed that the main appellant is a bottler of Pepsi brand of aerated waters and is purchasing concentrate from PFL and converting into aerated waters sells the same to various distributors, PFL discharges central excise duty on the concentrate so sold to the main appellant; the manufacturing activity of aerated waters is diluting the concentrate purchased from PFL; the main appellant is also engaged in the trading activity of various canned products of Pepsi brand which are purchased by them from Pepsico India Holdings Ltd. which is not the same as PFL. In order to enhance the sales of aerated water ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tomer or vendor, public relation services, management or supervision, and includes services as a commission agent, but does not include any activity that amounts to manufacture of excisable goods. Explanation : For the removal of doubts, it is hereby declared that for the purposes of this clause, - (a) "commission agent" means any person who acts on behalf of another person and cause sale or purchase of goods, or provision or receipt of services, for a consideration, and includes any person who, while acting on behalf of another person - (i) deals with goods or services or documents of title to such goods or services; or (ii) collects payment of sale price of such goods or services; or (iii) guarantees for collection or payment fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rutinized in depth, do not indicate that the main appellant is required to promote or market or sale of goods produced or provided or belonging to PFL. In the case in hand, PFL is only producing and selling concentrate to the main appellant for converting into aerated water. The adjudicating authority's findings that the concentrates are belonging to PFL, also does not cut the ice, inasmuch the said concentrate is sold on payment of excise duty to the main appellant, which would indicate that once the sale takes place, the concentrate does not remain the property of PFL. 10. The definition of "business auxiliary service" may not cover the transaction in this case, as the main appellant is not promoting or marketing of services provided ..... X X X X Extracts X X X X X X X X Extracts X X X X
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