TMI Blog2022 (11) TMI 1093X X X X Extracts X X X X X X X X Extracts X X X X ..... vider. This exception to the general scheme of levy of service tax is also called reverse charge mechanism . In the instant case, it has also been contended by the assessee that the services provided by Foreign Agents do not fall within the scope of definition of C F Agent Service and classified under Business Auxiliary Service and services of a commission agent in relation to agricultural produce were exempt under Notification No. 13/2003-ST dated 20.06.2003. But what appears from the impugned order is that this aspect was also not properly examined by the learned Commissioner. This is another reason for de novo adjudication of the case. This matter needs to be remanded for denovo adjudication on all the issues - Appeal allowed by way of remand. - Service Tax Appeal No.11908 of 2013 in Service Tax Misc. Application (ORS) No. 10226 of 2022 - Final Order No. A/11736/2022 - Dated:- 23-11-2022 - MR. RAMESH NAIR, MEMBER (JUDICIAL) AND MR. RAJU, MEMBER (TECHNICAL) Shri Paresh M. Dave, Advocate for the Appellant Shri Dinesh Prithiani, Assistant Commissioner (AR) for the Respondent ORDER This is an Appeal against Order-in-Original No. STC/03 to 04/COMMR/AHD/2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mmissioner in concluding that the goods were sold or deemed to have been sold in India, because then the persons on whom the so called invoices were raised were the buyers and owners of the goods, and the appellant s interest in the goods no longer subsisted. 3.1 He further submits that all the activities and services by the consignment agents have been performed after export of the goods when the goods landed in foreign countries. Therefore, the conclusion that a part services was provided by the appellant in India is ex-facie illegal because the appellant has not provided any services, whereas the revenue s case is that the Appellant has received services of C F agent from the agent located in foreign countries. 3.2 He also submits that in the present case, the amount /value of expenses on which service tax is demanded are all for the activities and services beyond the territory of India; because all the heads of expense initially paid by the consignment agent are for the activities and services after the goods leave India. From the evidence on records including the statement of the Appellant s Senior Manager (Accounts), it is an admitted fact that the consignment agent hav ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... torage and warehousing, quality assurance charges, road freight, packing charges, distribution charges etc. to the consignment agents such reimbursable expenses are separately shown in the invoice of the consignment agents. The commission being the remuneration of such agents is also separately shown in the same invoices. On the basis of the evidence like the consignment agent s invoices, the statement of the appellant s senior manager (account) and also the income tax returns etc. the revenue has accepted in this proceeding that over and above the commission agent, the consignment agent were charging the above referred expenses which were reimbursed by the appellant to them. It is now a settled legal position that reimbursable expenses cannot be considered to be a part of the gross value of the taxable service rendered by the service provider, and service tax cannot be charged on such reimbursable expenses. He placed reliance on the following decisions :- INTERCONTINENTAL CONSULTANTS AND TECHNOCRATS PVT. LTD. 2013 (29) STR 9 (DEL.) INTERCONTINENTAL CONSULTANTS AND TECHNOCRATS PVT. LTD. 2018 (010) GSTL 0401 (SC) C.B.R.E. SOUTH ASIA PVT. LTD. 2021 (51) GSTL 325 TVS LO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vided that where the recipient of the service is an individual and such service received by him is otherwise than for the purpose of use in any business or commerce, the provisions of this subsection shall not apply : Provided further that where the provider of the service has his business establishment both in that country and elsewhere, the country, where the establishment of the provider of service directly concerned with the provision of service is located, shall be treated as the country from which the service is provided or to be provided. (2) Where a person is carrying on a business through a permanent establishment in India and through another permanent establishment in a country other than India, such permanent establishments shall be treated as separate persons for the purposes of this section. Explanation 1. - A person carrying on a business through a branch or agency in any country shall be treated as having a business establishment in that country. Explanation 2. - Usual place of residence, in relation to a body corporate, means the place where it is incorporated or otherwise legally constituted. The general scheme of levy of service tax is that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vice tax on those services. Section 66A of the Act does not explicitly require the receipt of service in India; it rather refers to receipt of service by a person who has his place of business, fixed establishment, permanent address or usual place of residence in India . To our mind, there is a discernible difference between this underlined clause and receipt of service in India by a person who has . We have, of course, also noted that Rule3 of the Taxation of Services (Provided from Outside India) Rules, 2006 is captioned in such a way that (for purposes of Section 66A) taxable services provided from outside India should be received in India. However, it is pertinent to note that Rule 3, in its body, refers to such services as are received by a recipient located in India for use in relation to business or commerce . The phrase received by a recipient located in India found in the text of Rule 3 matches the phrase received by a person who has his place of business, fixed establishment, permanent address or usual place of residence in India , found in the text of Section 66A of the Act. It is, indeed, a debatable question as to whether any requirement of receipt of taxab ..... X X X X Extracts X X X X X X X X Extracts X X X X
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