2023 (10) TMI 173 - AT - Service Tax

Levy of Service tax - auctioneer s service - assessee, a Co-operative Society, is conducting auction of various commodities for which they receive consideration labelled as commission/service charges - Business Support Service - Renting of Immovable Property Service. Auctioneer s service - Business Support Service - HELD THAT - Since these issues have been considered and decided in favour of the taxpayer. Nothing is brought on record by the Revenue as to any appeals filed or any stay orders by higher courts against the orders of the co-ordinate Benches in M/S. NAMAKKAL AGRICULTURAL PRODUCERS CO-OPERATIVE MARKETING SOCIETY VERSUS COMMISSIONER OF CENTRAL EXCISE, SALEM 2023 (4) TMI 1077 - CESTAT CHENNAI - Hence, it is held that the demands confirmed in the impugned Order-in-Appeal deserve to be set aside. Renting of Immovable Property Service - HELD THAT - The very classification of renting of the above under renting of immovable property service is a misnomer and the consequent demand, therefore, can never be justified. Hence, this part of the demand as well as the impugned order set aside. Appeal allowed.

Summary

Issues involved:
The issues involved in the judgment are the demands under (1) Auctioneer's Service, (2) Business Support Service, and (3) Renting of Immovable Property Service.

Auctioneer's Service:
The case revolved around a Co-operative Society conducting auctions of various commodities, receiving consideration as commission/service charges. The Revenue issued a Show Cause Notice proposing to demand Service Tax on these auction services. The society contended that it acted as a commission agent only, falling under 'business auxiliary services' exempted from Service Tax. The Tribunal referred to previous orders where similar issues were decided in favor of the taxpayer, concluding that demands under Auctioneer's Service were not sustainable.

Business Support Service:
The Revenue claimed that the society collected jewel service charges and appraising charges on jewel loans, categorizing them as business support services. The society argued that these charges were for assisting members in obtaining jewel loans and were not business support services. The Tribunal, citing past orders, found that the demands under Business Support Service were not maintainable and should be set aside.

Renting of Immovable Property Service:
Regarding renting charges for godown space, the Revenue viewed it as renting of immovable property service. However, the society collected charges for storing copra, an agricultural produce, which did not qualify as rent since the charges were below the threshold limit and the produce was exempted. The Tribunal referred to definitions of agricultural produce to support their decision, setting aside the demand under renting of immovable property service.

The Tribunal, after considering the contentions and lower authorities' orders, set aside the impugned order and allowed the appeal with consequential benefits. The judgment highlighted the misclassification of services and the incorrect demands made by the Revenue, ultimately ruling in favor of the appellant.