TMI Blog2008 (6) TMI 14X X X X Extracts X X X X X X X X Extracts X X X X ..... mber (T) Ms. Aparna H., Advocate, for the Appellant. Shri Sameer Chitkara, SDR, for the Respondent. [Order Per: Mr. B.S.V. Murthy, Member (Technical)] - The issue involved in this case is as to whether services of Del-credre agency provided by the appellant is covered under the category of Clearing and Forwarding (C F) agency service and leviable to service tax. The appellants are registered as C F agent from Sept.-99. The appellants entered into two separate agreements in 1999 with M/s Haldia Petrochemicals Ltd. (hereinafter referred to as HPL). One agreement was for appointment as Consignment Stockist Agent and another agreement was for appointment as Del Credre agent. Both were renewed by fresh agreements in 2002. Relevan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nment Stockist will be responsible to sell the Products as per instructions of the COMPANY at prefixed list prices of HPL declared and intimated to the Consignment Stockist by the COMPANY from time to time. 4. Storage Facilities The Consignment Stockist confirms that it has a good, suitable and sufficiently large godown/warehouse/business establishment accommodation at his depot(s) situated at Daman, Silvassa, Bhiwandi Mumbai (hereinafter called 'the said Depot') duly approved by the COMPANY. The changes therein at the advice of the COMPANY and to the satisfaction of the COMPANY." "Para 2 A B of the Del Credre Agent Agreement: 2. PROCEDURE The terms and conditions subject to which promotional activities and the sale of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ti Petrochemicals." 2. A show cause notice was issued on 17.12.2004 proposing to levy service tax on the services provided on the basis of second contract wherein the services to be provided was shown as Del-credre agent from Oct.99 to June-03 amounting to Rs.12,75,715/- which resulted in confirmation by the lower authorities. Further, penalty under Section 76, 77 were also imposed besides requiring the appellant to pay interest on the tax involved. 3. Heard both the sides. Ms. Aparna, learned advocate on behalf of the appellant stated that lower authority failed to recognize the fact that there were two types of services being rendered and there were two separate contracts for the same. First contract required appellants to main ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion basis, would not be covered under C F Agent service. The commission agency service came to be covered under business auxiliary services w.e.f. 1.7.03 only. Learned SDR reiterates the order passed by the lower authority. 5. The observations of the Jt. Commissioner and also Commissioner (Appeals) relating to the agreements shows that there was no clarity regarding the two contracts and the type of work done by the appellant and terms and conditions of agreement and the nature of the agreement. The Jt. Commissioner in his OIO observed as follows: "This agreement made on this 1st day of July 2002, between Haldia Petrochemicals Ltd. having its registered office at 1, Auckland Palace, Calcutta- 700 017 (herein after called company which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... godown/ware house/business establishment accommodation at its depot duly approved by the Company. That the consignment stockist shall keep adequate records as per Company's requirement for receipt, sale and stock. That the Consignment Stockist shall comply with the requirement of all statutes, laws and regulations for the storage and the sale of the products to the customers and shall exclusively be liable for the collection and payment of all taxes, dues and levies. That while effecting sale of the products, the consignment stockist shall disclose that he is a consignment stockist of the Company. That in consideration of the services rendered by the consignment agreement, the company shall pay to the consignment stockist a commission at ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly. It is very clear that the agreement have been made for consignment stockist only. The nature of the services and norms and conditions of consignment stockist is similar just like the service of Clearing Forwarding agent. The consignment stockist shall maintain a large godown business establishment accommodation at its depot and appropriate stock at its cost of the dealing product to meet the requirements of the market. The company will transfer his product to the consignment stockist from time to time through stock transfer invoices at prices determined by the company based on prevailing market prices. The consignment stockist will be responsible to sell the products as per instructions of the company at prefixed list prices of M ..... X X X X Extracts X X X X X X X X Extracts X X X X
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