2015 (9) TMI 1280 - AT - Service Tax

Business Auxiliary Services - Benefit of Notification No.13/2003-ST, dated 20.6.2003 towards commission agent s services - Held that - The notification exempts business auxiliary services provided by a commission agent. In other words, so long as the appellant provided business auxiliary services (even if such services did not strictly fall within the purview of the role of a commission agents) it was eligible for the benefit of the said notification. - as the appellant qualified to be called a commission agent and admittedly rendered business auxiliary services, it was squarely eligible for the benefit of Notification No. 13/2003-ST even if one resorts to (the so-called) strict interpretation of the said Notification. In our view the wording of Notification No. 13/2003-ST does not suffer from any ambiguity and readily lends itself to plain and straight forward interpretation rendering recourse to interpretational discourse unnecessary. - Impugned order is set aside - Decided in favour of assessee.

Summary

Issues:
- Whether the appellant was eligible for the benefit of Notification No.13/2003-ST as a commission agent.
- Whether the appellant's activities fell within the definition of a commission agent as per the said Notification.
- Whether the appellant's provision of business auxiliary services affected its eligibility for the benefit of the said Notification.

Analysis:

Issue 1: Eligibility for Notification No.13/2003-ST
The appeal was filed against a service tax demand confirmed by the primary adjudicating authority. The appellant contended that it qualified as a commission agent under Notification No.13/2003-ST and was providing Business Auxiliary Services to its clients. The appellant argued that it was eligible for the benefit of the said Notification based on the agreements entered into with its clients.

Issue 2: Definition of Commission Agent
The primary adjudicating authority held that the appellant was not primarily a commission agent and thus not eligible for the benefit of Notification No.13/2003-ST. The authority noted that the appellant was engaged in various activities beyond the scope of a commission agent, such as promotional activities and event management, which were considered taxable under Business Auxiliary Services. However, the authority's interpretation was challenged as the Notification did not explicitly exclude commission agents providing other services.

Issue 3: Impact of Business Auxiliary Services
The primary adjudicating authority's decision was based on the premise that the appellant's provision of business auxiliary services beyond the role of a commission agent made it ineligible for the Notification's benefit. However, the appellate tribunal disagreed, emphasizing that the Notification exempted business auxiliary services provided by a commission agent without restricting the nature of services a commission agent could offer.

Conclusion
The appellate tribunal found that the appellant satisfied the criteria to be classified as a commission agent under Notification No.13/2003-ST. The tribunal highlighted that the appellant's provision of business auxiliary services did not disqualify it from the Notification's benefit. Citing previous judgments and a straightforward interpretation of the Notification, the tribunal set aside the service tax demand and penalties, allowing the appeal in favor of the appellant.