2009 (9) TMI 371 - AT - Service Tax

Clearing and forwarding agent s services- Issue involved in this case is regarding inclusion of the transport charges in the gross value for the liability to Service Tax under the head of C&F agent. It is undisputed that the appellant is having separate contracts one for C&F and one for transport charges. The adjudicating authority had dropped proceedings as regards the Service Tax liability on the transportation charges while the Commissioner as Revisionary Authority under section 84 has reviewed the said order and confirmed the demand on the appellant. Held that- Without expressing any opinion on merits we set aside the impugned order and remand the matter to the ld. Commissioner as a Revisionary Authority to re-consider the issue afresh after following the principles of natural justice. Appeal is allowed by way of remand to the ld. Commissioner as Revisionary Authority.

Summary

Issues:
1. Waiver of pre-deposit of service tax, interest, and penalty.
2. Inclusion of transport charges in the gross value for service tax liability under the head of C&F agent.

Issue 1: Waiver of Pre-Deposit:
The appellant filed a stay petition seeking the waiver of pre-deposit of Service Tax, interest, and penalty. The Tribunal, after hearing both sides and considering the narrow compass of the issue, decided to dispose of the appeal itself at that stage. Consequently, the Tribunal waived the condition of pre-deposit and proceeded with the appeal for disposal.

Issue 2: Inclusion of Transport Charges in Gross Value for Service Tax Liability:
The main issue in this case revolved around the inclusion of transport charges in the gross value for the liability to Service Tax under the head of C&F agent. The appellant had separate contracts for C&F and transport charges. While the adjudicating authority had dropped proceedings regarding the Service Tax liability on transportation charges, the Commissioner, as the Revisionary Authority, reviewed the order and confirmed the demand on the appellant.

Upon review, it was found that the Commissioner did not consider the evidence submitted by the appellant, which included separate contracts for C&F and transport, as well as bills for transport charges. The Tribunal noted that the lack of findings by the Commissioner on the evidence submitted by the appellant was a crucial factor. Since there were two distinct contracts, both could not be considered for determining the taxable value. Therefore, the Tribunal set aside the impugned order and remanded the matter to the Commissioner, directing a re-consideration of the issue after following the principles of natural justice. The appeal was allowed by way of remand to the Commissioner as the Revisionary Authority.

In conclusion, the Tribunal's judgment focused on the waiver of pre-deposit and the correct determination of the taxable value concerning the inclusion of transport charges in the gross value for Service Tax liability under the C&F agent category. The decision emphasized the importance of considering all evidence and following due process in reaching a fair and just conclusion in matters of tax liability.