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2022 (9) TMI 742 - AT - Service TaxMaintainability of appeal - monetary limit involved in the appeal as per litigation policy Circular F. No. 390/Misc/116/2017-JC dated 22.08.2019 - Levy of Service Tax - Business Auxiliary Services - on behalf of overseas clients facilitated in the process of transportation of consignment from taxable territory to final destination - mark-up i.e. the difference between the value of the services received by the service provider and charged by the respondent from their clients abroad - HELD THAT - The issue involved in the matter is no longer res integra and has been covered by the Board circular in favour of the respondent. In the case of M/S BVC LOGISTICS PVT. LTD. VERSUS CCE ST, JAIPUR 2017 (9) TMI 709 - CESTAT NEW DELHI , it was held that CBEC vide Circular No.197/7/2016-ST dated 12.08.2016 has clarified that a freight forwarder, when acting as a principal, will not be liable to pay service tax when the destination of the goods is from a place in India to a place outside India. The appeal filed by the Revenue is dismissed.
Issues:
1. Appeal against Order-in-Appeal No. MKK/001/RGD APP/2019 dated 05.04.2019 2. Confirmation of service tax demand and interest 3. Imposition of penalties under various sections of the Finance Act, 1994 4. Allegations regarding business auxiliary services provided by the assessee 5. Cross objections filed by the respondent 6. Issue of maintainability of the appeal based on the amount involved 7. Legal precedent and circulars supporting the respondent's case Analysis: 1. The appeal was filed by the Revenue against an Order-in-Appeal dated 05.04.2019. The Commissioner (Appeals) set aside the Order-in-Original that confirmed the demand of service tax and interest. Various penalties were imposed under different sections of the Finance Act, 1994. 2. The show cause notice alleged that the assessee provided business auxiliary services and facilitated transportation of consignments for overseas clients. The respondent charged a mark-up on these services, which was considered a commission requiring service tax payment. The Order-in-Original was set aside by the Commissioner (Appeals), leading to the Revenue's appeal. 3. The respondent filed cross objections in response to the show cause notice demanding service tax for specific periods. The Commissioner (Appeals) setting aside the Order-in-Original prompted the Revenue's appeal, arguing that the issue was no longer res integra and was covered by legal precedents and circulars. 4. During the hearing, the Authorized Representative for the Revenue reiterated their grounds for appeal, while the respondent's counsel argued that the appeal was not maintainable based on the amount involved. The respondent cited various tribunal decisions supporting their case, including Marinetrans India Pvt. Ltd., Mas Logistics, Phoenix International Freight Services Pvt. Ltd., BVC Logistics Pvt. Ltd., and DHL Logistics Pvt. Ltd. 5. The Tribunal considered the impugned order, submissions, and legal precedents. Referring to the case of BVC Logistics Pvt. Ltd., it was observed that the issue was not new and was covered by a Board circular favoring the respondent. The circular clarified the role of freight forwarders acting as principals in providing transportation services outside India. 6. Based on the legal precedents and circulars, the Tribunal upheld the impugned order, dismissing the Revenue's appeal and disposing of the respondent's cross objections accordingly. The decision was pronounced in open court, concluding the matter.
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