2008 (11) TMI 121 - AT - Service Tax

Whether a commission agent is liable to pay tax as Clearing and Forwarding Agents - Original adjudicating authority had confirmed demand by following the Tribunal decision in Prabhat Zarda Factory which stands overruled by the LB of the Tribunal in Larsen & Tubro Ltd. - mere booking order for the principal by an agent on commission basis cannot be held taxable under C&F Agent services - In terms of said LB decision the Commissioner (Appeals) is justified in setting aside the demand

Summary

The Appellate Tribunal CESTAT, Ahmedabad ruled that a commission agent is not liable to pay service tax under the category of "Clearing and Forwarding Agents." The decision was based on a larger bench ruling that mere booking orders for the principal by an agent on a commission basis are not taxable under C&F Agent services. The revenue's appeal was rejected.