2023 (9) TMI 920 - AT - Service Tax

Levy of Service Tax - Clearing Forwarding Agent services - Loading Charges - Unloading Charges - Service Commission - HELD THAT - The Appellant claims that their agreement with My Home Industries Ltd., specifies that they would be reimbursing the loading and unloading charges. He further submits that the invoices raised by them towards loading and unloading charges are purely on account of reimbursement. In the interest of justice, the Appellant should be given an opportunity to produce all the relevant documents before the Adjudicating Authority to canvass these submissions. Appeal allowed by way of remand.

Summary

Issues involved:
The issue in this case involves whether the appellant, a Clearing & Forwarding Agent (C & F Agent), is required to pay Service Tax on charges received from their principal for loading, unloading, and service commission.

The Appellate Tribunal CESTAT HYDERABAD heard the case where the Department issued a Show Cause Notice to the Appellant regarding charges received from their principal, My Home Industries Ltd. The Department contended that the Appellant should pay Service Tax on the entire amount of Rs. 70/- received for loading, unloading, and service commission.

The Appellant argued that the loading and unloading charges were incurred by them and subsequently reimbursed by the Principal, as per the agreement and reimbursable invoices raised. The Appellant relied on the case law of Union of India & ANR Vs M/s InterContinental Consultants & Technocrats Pvt Ltd. to support their claim that the demands should be set aside.

On the other hand, the Authorized Representative for the Department submitted that the Adjudicating Authority had noted that the Appellant failed to provide evidence that the amounts received were solely for reimbursement. Therefore, the demand was justified as the entire amount was considered as consideration received by the Appellant.

After hearing both sides, the Member (Judicial) felt that the Appellant should be given an opportunity to produce all relevant documents before the Adjudicating Authority to support their submissions. The Member decided to remand the matter to the Adjudicating Authority for further examination.

The Adjudicating Authority was directed to follow the principles of natural justice and allow the Appellant to present all documentary evidence within 4 months from the date of receipt of the order. The appeal was disposed of with this decision.