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TMI Blog2013 (8) TMI 117X X X X Extracts X X X X X X X X Extracts X X X X ..... has agreed to provide cold storage for the purpose of storing and forwarding the frozen products belonging to HLL. In Article 2.13 to 2.29 of the Agreement in view of perishable nature of the goods, assessee is required to maintain specific temperature for storage of frozen goods before dispatching the same as per direction of HLL. Therefore, the storage of the goods in cold storage is an inseparable part of Clearing & Forwarding activity undertaken by the assessee - Since storage of the goods in cold storage is essential part of assessee’s C&F operations, cold storage charges are required to be added in taxable value of C&FA services – Decided against the Assessee. Classification of services under C&FA or under storage and warehouse – H ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter referred to as assessee) and second by Revenue against the same Order-in-Appeal No. 185-CE/GZB/2008 dated 24.9.2008 passed by Commissioner (Appeals), Central Excise, Meerut-I. 2. Brief facts of the case are that on examination of records of the assessee for the period 2001-02 to 2004-05 it was pointed out that assessee received an amount of ₹ 1,46,05,000/- from M/s Hindustan Lever Ltd. (HLL) for carrying out services of cold storage/clearing and forwarding operations of frozen products. According to department, the said service is chargeable to service tax. A Show-Cause Notice dated 21.7.2006 was issued to the assessee demanding service tax amounting to ₹ 9,46,766/- along with interest and also proposing penalties on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... service cannot be levied under different taxable service. He relies on decision of Kerala High Court in case of Kerala State Industrial Enterprises Ltd. Vs. CCE reported in 2011 (28) STR 574 (Ker.) and CCE Vs. Federal Bank Ltd. reported in (2010) 34 VST 27 (Ker.). He further points out, that assessee is not engaged in any clearing corporation and as such in view of decision of Punjab Haryana High Court in case of CCE Vs. Kulcip Medicines (P) Ltd. - 2009 (14) STR 608 assessee s activity does not fall under C F service also. He submits demand is also hit by time limitation as assessee has replied vide their letter dated 8.11.2002 and 9.12.2002, department s letter dated 27.9.2002 and 20.11.2002, which shows the facts were in the knowledge ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his appeal is whether assessee s activity of storing of goods in cold storage can be covered under Clearing and Forwarding Agent Service and whether demand is hit by time limitation. 7. Clearing Forwarding Service is defined under Section 65(25) of the Finance Act which provides that Clearing and forwarding agent means any person who is engaged in providing any service, either directly or indirectly, connected with the clearing and forwarding operations in any manner to any other person and includes a consignment agent. 8. We find that assessee is receiving frozen food from HLL, storing the goods in cold storage and thereafter dispatches the goods as per directions of principal. They have entered into an agreement in which M/s Monsa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... warehousing service was enacted from which cold storage was excluded. To decide the issue of classifiability of services under C FA or under storage and warehouse, one has to apply Section 65A(2)(b) of the Finance Act under what services is to be classified under service which gives essential character of the service. We have already held that storage of frozen goods in cold storage is an inseparable part of assessee s activity of clearing Forwarding operation. We are therefore of the view that essential character of service is C FA service and therefore service is classifiable under C FA service. 12. Ld. Advocate has contended that assessee is not involved in clearing operation and therefore not covered under C FA service in view of ..... X X X X Extracts X X X X X X X X Extracts X X X X
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