2008 (7) TMI 200 - AT - Service Tax

C/F Agent assessee s contention is that as per the agreement the appellants were only procuring order on commission basis and as per the decision of the Larger Bench of the Tribunal in the case of Larsen & Toubro Ltd v CCE and affirmed by Hon ble Punjab & Haryana High Court in the case of CCE v. United Plastomers held that mere procuring of orders on commission basis not amounted to C&F Agent service assessee s plea is acceptable - therefore demand is set aside

Summary

Issues involved: Appeal against demand of service tax prior to 1-7-2003 for providing Clearing and Forwarding Agent service.

Analysis:
1. The appellant contested the demand of service tax before 1-7-2003, arguing that post that date, service tax was imposed on commission agents. The revenue contended that as the appellants procured orders and assured payment, they provided Clearing & Forwarding Agent services.

2. The Tribunal noted that the appellants only procured orders on a commission basis, not providing C&F Agent services. Referring to the decision in Larsen & Toubro Ltd. v. CCE and CCE v. United Plastomers, the Tribunal held that mere order procurement on commission basis did not constitute C&F Agent service.

3. Considering the settled position by the Larger Bench and the High Court, the Tribunal set aside the impugned orders and allowed the appeals, ruling in favor of the appellant.