2013 (12) TMI 1325 - AT - Service Tax

Waiver of pre-deposit of Service Tax - C & F agent - Held that - appellants are only engaged for handling the railway wagons through which the final product of M/s. Oswal Chemicals and Fertilisers Ltd. is being transported. The various activities of C & F agent as enumerated in the Board s Circular No. B-43/7/97-TRU, dated 11-7-1997 requiring C & F agents to perform various functions like receipt of material from the principal, dispatch of the same to the customers, receiving orders from principal, arranging dispatch of the goods as per direction of the principal, preparing invoices on behalf of the principal and maintaining records of receipt and dispatch of the goods. Apart from the fact that we find that the agreement entered into by the appellant and M/s. Oswal Chemicals and Fertilisers Ltd. does not satisfy the condition of C & F agent, we also note that there is clear finding of the fact by the Commissioner that the appellants was not issuing any invoice on behalf of the companies and the bills raised by them are against loading and transportation of the goods from Railways to the godown - appellant has good case on merits, making him entitled to unconditional dispensation with the requirement of pre-deposit - Stay granted.

Summary

Issues:
Prayer to dispense with pre-deposit of Service Tax and penalty.

Analysis:
The case involved a prayer to waive the condition of pre-deposit of Service Tax and penalty amounting to Rs. 14,63,849. The Service Tax was confirmed against the appellant by the Commissioner in review proceedings, alleging that the appellant provided services of C & F agents to a specific company. However, the original order passed by the Additional Commissioner favored the appellant.

Upon examination of the agreement between the appellant and the company, it was found that the activities listed in the agreement were related to handling railway wagons for transporting the final product of the company. These activities did not align with the functions typically performed by C & F agents as per the Board's Circular. The Commissioner also noted that the appellant did not issue invoices on behalf of the company, and the bills raised were for loading and transportation of goods from Railways to the godown.

Based on these findings, the Tribunal concluded that the appellant had a strong case on merits. Therefore, the Tribunal decided to unconditionally dispense with the requirement of pre-deposit, allowing the stay petition in favor of the appellant. The judgment was pronounced in open court by the Tribunal.

This detailed analysis of the judgment highlights the key issues, arguments presented, examination of relevant agreements, and the ultimate decision reached by the Appellate Tribunal CESTAT NEW DELHI.