2009 (10) TMI 180 - AT - Service Tax

Clearing and forwarding agent- As per agreement between and a manufacturer, goods were cleared by manufacturer and supplied to assessee for being forwarded to customer. Service tax was demanded from assessee on ground that it was rendering services of clearing and forwarding agent. In the light of the decision of CCE v. Kulcip Medicines (P.) Ltd. 2009 20 STT 264 (Punj. & Har.), in which held that unless the arrangement is for clearance of goods by the assessees from their principals, the assessee cannot be considered as clearing and forwarding agent as no clearing service is performed by them, is squarely applicable thus set aside the impugned order and allow the appeal.

Summary

The Appellate Tribunal CESTAT, Chennai ruled in favor of the appellant in a service tax dispute regarding clearing and forwarding services. The tribunal found that the appellants were not clearing agents as they did not physically clear goods from the manufacturer's premises. The decision was based on a similar case from the Punjab and Haryana High Court. The tribunal set aside the service tax demand and allowed the appeal.