2011 (6) TMI 592 - AT - Service Tax

Waiver of pre-deposit - Tour Operator , Air Travel Agent and Travel Agents services - appellant submitted that the services provided in the out-bound tours were performed outside India. Therefore they are not liable to Service tax under the provisions of Finance Act, 1994 - services provided by the appellant prima facie is covered by the Circular No. 111/05/2009-S.T., dated 24-2-2009 issued by the Board. waiver of pre-deposit granted. Treating the amount already paid by the appellant is sufficient

Summary

Issues:

1. Whether the appellant, acting as a consignment agent for a company, was providing brand named services or promoting the brand's goods.
2. Determination of whether the appellant was eligible for exemption as a small tax payer under Notification No. 6/2005-S.T.

Issue 1:

The appellant, a consignment agent appointed by a company for the sale and marketing of branded goods, argued that they were not marketing the brand's goods but only promoting the sale of the goods as a consignment agent. The appellant contended that they did not provide branded services and should be considered a small tax payer eligible for exemption. The appellant cited previous orders in their favor by the Jaipur Commissionerate.

On the other hand, the Departmental Representative argued that the appellant, by having an outlet promoting the brand's goods, was indeed providing brand named services essential for marketing. The Departmental Representative relied on the contractual terms between the appellant and the company to support their claim that the appellant provided brand name services.

After hearing both sides and examining the record, the Tribunal noted the confusion regarding whether the appellant was merely a trader of branded goods or was actively promoting the brand's goods. The Tribunal found that there was no evidence to show that the appellant marketed the brand's goods to recipients of marketing services. The Tribunal concluded that the appellant, acting as a consignment agent, did not promote or market branded services but provided Business Auxiliary Service to the company. The Tribunal held that the appellant should be considered a small tax payer and granted them exemption benefits under the relevant notification.

Issue 2:

The second issue involved determining whether the appellant was eligible for exemption as a small tax payer under Notification No. 6/2005-S.T. The Tribunal, after analyzing the factual matrix and the nature of services provided by the appellant, concluded that the appellant met the criteria to be considered a small tax payer. The Tribunal found that the appellant's activities as a consignment agent did not amount to promoting or marketing branded services, leading to the decision to allow the appeal and grant the appellant the exemption benefit under the notification.

In conclusion, the Tribunal ruled in favor of the appellant, holding that they were not promoting branded services but providing Business Auxiliary Service as a consignment agent. The appellant was deemed a small tax payer eligible for exemption benefits under the relevant notification, and the appeal was allowed.