9911796707
TMI Blog2017 (2) TMI 1149X X X X Extracts X X X X X X X X Extracts X X X X ..... received by appellant under the category of production or processing of goods for or on behalf of client which we find incorrect and unsustainable, for the simple reason that there is nothing on record to show that Adani Exports Ltd., is getting the diamond jewellery manufactured by appellant; nor there is any agreement brought on record to show that Adani Exports Ltd., had in fact placed an order with the appellant for manufacturing and export of diamond jewellery. In the absence of any such evidence to indicate that Adani Exports Ltd., had availed the services of appellant for production or processing of goods, we find that the impugned order holding that appellant is producing or processing of goods on behalf of Adani Exports Ltd., is u ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... b-heading (v) of Rule 19 - Production or Processing of goods for or on behalf of the client. Show-cause notice dated 03.03.2008 was issued for the demand of service tax, interest thereof and for imposing penalties under Section 76 and 78 of the Finance Act, 1994. The period involved in this case is from 15th July, 2003 to 30th November 03. Appellant contested the show-cause notice on various grounds like appellant has not provided any services, there is no production or processing of goods on or for Adani Exports Ltd. and they had only passed on the benefits to Adani Exports Ltd., but no services were rendered, this is an income received by appellant accounted only as commission and does not mean that the said income is taxable under busine ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting the same under Foreign Trade Policy. Appellant had accrued certain benefits under foreign trade policy under the target plus scheme during the relevant period which entitled the appellant to transfer the sale benefits to any other entity by mentioning their name on the documents like invoice and shipping bills. It is the case of Revenue that appellant having received 1% of FOB value from Adani Exports Ltd, the said amount is liable to be taxed under business auxiliary services under the category of production or processing of goods on behalf of client . We find that the findings recorded by adjudicating authority are totally misconstrued and mis-directed. On perusal of the invoice raised by appellant, we find that appellant has raised ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (v) Production or processing of goods for, or on behalf of, the client (vi) Provision of service on behalf of the client; or (vii) a service incidental or auxiliary to any activity specified in sub-clauses (i) to (vi), such as billing, issue or collection or recovery of cheques, payments, maintenance of accounts and remittance, inventory management, evaluation or development of prospective customer or vendor, public relation services, management or supervision and includes services as a commission agent, [but does not include any activity that amounts to manufacture of excisable goods. Explanation. - For the removal of doubts, it is hereby declared that for the purposes of this clause, - (a) Commission agent means any p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he sale of marine products. After considering the entire issue, their Lordships upheld the order of the Tribunal which has been upheld by the Hon'ble High Court and recorded in paragraph 35 and 36 as under:- 35. The Appellate Tribunal has arrived at definite conclusion that the Export House Premium is nothing but an integral part of sale price realized by the assessee - a supporting manufacturer from the Export House. The Tribunal further held that the Export House Premium cannot possibly be considered to be either commission or brokerage, as a person cannot earn commission or brokerage for himself. 36. The High Court has upheld the findings of the Tribunal. In our considered view, the order of the Appellate Tribunal is based ..... X X X X Extracts X X X X X X X X Extracts X X X X
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