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2017 (10) TMI 505 - AT - Service TaxBusiness Auxiliary services - Levy of Service tax - commission received from M/s. Amadeus India Pvt. Ltd. for use of CRS - Held that - the issue has already been decided by this Tribunal in the case of D. Pauls Consumer Benefit Ltd. Vs. CCE New Delhi 2017 (3) TMI 1019 - CESTAT NEW DELHI , where on similar issue it was held that the service provided by the assessee-Appellants has rightly been covered under the heading Business Auxiliary Service as defined u/s 65(19) of the FA, 1994 - demand upheld. Commission received from other IATA agents - submission of the appellant is that they are purchasing the tickets from IATA agents on principal to principal basis and therefore, the commission received falls under the category of Business Auxiliary services - Held that - In the present facts of the case, the appellant rendered the service to the customers, as air travel agent and received the commission from principal IATA agent, who also renders the same service i.e. air travel agent services - the services rendered by sub-agent is also the same and it cannot be different from that of air travel agent services - similar view taken in the case of Commissioner Vs. Zuari Travel Corporation 2013 (7) TMI 911 - CESTAT MUMBAI - demand set aside. Appeal allowed in part.
Issues:
1. Whether the commission received from M/s. Amadeus India Pvt. Ltd. is chargeable to Service Tax under Business Auxiliary services. 2. Whether the commission received from International Air Tickets Association (IATA) agents is liable to Service Tax under Business Auxiliary services. Analysis: Issue 1: Commission from M/s. Amadeus India Pvt. Ltd. The appellant, engaged in International Air Ticket Booking services, received commission from M/s. Amadeus India Pvt. Ltd. The Revenue contended that this commission is chargeable to Service Tax under Business Auxiliary services as it was seen as promoting the business of M/s. Amadeus India Pvt. Ltd. The appellant argued that their use of Central Reservation Systems (CRS) software provided by M/s. Amadeus was for self-use and did not involve promoting M/s. Amadeus' business. The Tribunal, citing a previous decision, upheld the demand of service tax under Business Auxiliary services for the commission received from M/s. Amadeus. Issue 2: Commission from IATA Agents The appellant also received commission from IATA agents on booking air tickets for clients. The Revenue claimed that this commission, shared between the principal IATA agent and the appellant, was for providing marketing support and thus liable to service tax under Business Auxiliary services. The appellant argued that as they operated on a principal-to-principal basis with IATA agents and the service tax was already paid by the principal IATA agent, no further tax was due. The Tribunal, considering the nature of services provided and previous decisions, concluded that the commission received from other IATA agents was not liable to service tax under Business Auxiliary services, setting aside the demand. In summary, the Tribunal upheld the demand of service tax under Business Auxiliary services for the commission received from M/s. Amadeus India Pvt. Ltd. However, it set aside the demand for service tax on the commission received from other IATA agents. The appeal was partly allowed based on these findings.
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