2018 (8) TMI 1020 - AT - Service Tax

Clearing & Forwarding (C&F) Agent Services - appellant were doing business of consignment agent - whether classified under C&F Agency service or not? - Held that - Taking into consideration the various clauses as contained in the agreement between the parties, it is held that the appellant falls in the definition of Clearing & Forwarding Agent and therefore they are liable to pay the service tax - appeal dismissed - decided against appellant.

Summary

Issues:
- Appeal against order rejecting appeal and upholding Order-in-Original regarding service tax liability of the appellant as a Clearing & Forwarding (C&F) Agent.
- Interpretation of statutory definition of C&F Agent under Section 65(25) of the Finance Act, 1994.
- Analysis of agreement clauses to determine if the appellant falls within the definition of a C&F Agent.

Analysis:
The appeal was filed against an order rejecting the appellant's appeal and upholding the Order-in-Original related to the service tax liability of the appellant as a Clearing & Forwarding (C&F) Agent. The appellant was found to be doing business as a consignment agent without paying tax on the gross amount received. A show-cause notice was issued demanding payment of service tax for a specific period along with interest and penalties under relevant sections of the Finance Act, 1994. The lower authority confirmed the demand and imposed penalties, which led to the appellant filing an appeal before the Commissioner (Appeals) who also rejected the appeal, resulting in the present appeal before the Tribunal.

During the hearing, the appellant's representative requested the Tribunal to decide the appeal based on the grounds mentioned in the memorandum of appeal. On the other hand, the respondent's representative defended the impugned order, arguing that the appellant's activities fell within the definition of a C&F Agent as per the Finance Act, 1994. The respondent cited a previous case to support their position and highlighted specific clauses in the agreement between the parties to establish the appellant's role as a C&F Agent.

Upon careful consideration of the arguments and perusal of the material on record, the Tribunal found that the appellant indeed fell within the statutory definition of a Clearing & Forwarding Agent as provided in Section 65(25) of the Finance Act, 1994. The Tribunal also analyzed the agreement clauses between the parties and concluded that the appellant's activities aligned with the definition of a C&F Agent, making them liable to pay the service tax. Consequently, the Tribunal upheld the impugned order, dismissing the appeal of the appellant. The judgment was pronounced in open court on 31/7/2018.