2006 (10) TMI 376 - AT - Service Tax

Summary

Issues involved: Calculation of service tax on various elements borne by principal for C & F Agents.

Summary:
The Appellate Tribunal CESTAT, Bangalore addressed the issue of the Revenue confirming a service tax amount on the appellants, who were categorized as "C & F Agents." The Revenue added service tax on amounts paid by their principal for rental, telephone charges, handling charges, electricity charges, and employee salaries, considering them integral to clearing and forwarding operations. The appellants contended that service tax should only be calculated on the commission received, not on these elements covered by their principal. The learned Chartered Accountant cited a previous case involving M/s. Alathur Agencies where waiver of pre-deposit was granted, seeking similar relief in this matter due to the demand being legally unsustainable.

Upon hearing the arguments, the Tribunal noted that the appellants should not be responsible for the charges incurred by the principal for various expenses. Citing the precedent of M/s. Alathur Agencies, where waiver of pre-deposit was allowed, the Tribunal granted the stay application by waiving the pre-deposit amount and suspending its recovery until the appeal's final disposal. The appeal was scheduled for final hearing alongside the appeal of M/s. Alathur Agencies.