2009 (1) TMI 85 - AT - Service Tax

Allegation that the appellant collected the commission from clients in coordination of the sales and sale proceeds etc. and procurement of orders and goods Comm.(A) held that appellant rendered the C&F agent service - adjudicating authority had taken a contrary stand to Commissioner inasmuch as he treated the services of the appellant prior to 1.7.03 under the category of C & F agent and subsequently under BAS, which is not proper and legal - appeal is allowed by way of remand

Summary

Issues:
Alleged commission received for coordination of orders categorized as "clearing and forwarding services" under Service Tax.

Analysis:
The appellant, engaged in the manufacture of cane sugar and molasses, received a show cause notice alleging commission received from certain companies for coordination of orders falls under "clearing and forwarding services." The adjudicating authority confirmed the tax demand and penalties, upheld by the Commissioner (Appeals).

The appellant's advocate argued that the services rendered were not clearing and forwarding services but related to sales tax coordination. He pointed out discrepancies in the authorities' interpretation of the agreement and cited relevant case laws. The Commissioner (Appeals) was criticized for not fully examining the agreement to determine the nature of the services provided.

The Joint CDR supported the Commissioner (Appeals)'s findings, emphasizing the examination of the agreement and the confirmation of the tax demand. The Tribunal observed that the authorities based their decisions on the agreement provided by the appellant. It was noted that the Commissioner (Appeals) categorized the services as C&F agent services after examining the agreement, while the adjudicating authority had a different classification for services pre and post a specific date.

Ultimately, the Tribunal set aside the impugned orders and remanded the matter to the adjudicating authority for a fresh decision after considering the agreement and relevant case laws presented by both parties. The appeal was allowed by way of remand, emphasizing the need for a thorough examination of the agreement and legal precedents before making a final determination.