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TMI Blog2017 (9) TMI 554X X X X Extracts X X X X X X X X Extracts X X X X ..... ting margin set aside - appeal allowed - decided in favor of appellant. - ST/60059/2013 - ST/A/55445/2017-CU[DB] - Dated:- 24-7-2017 - Mr. S.K. Mohanty, Member (Judicial) And Mr. B. Ravichandran, Member (Technical) Present for the Appellant: S/Sh. V. Laxmikumaran Karan Sachdeva, Advocates Present for the Respondent: Sh. Amresh Jain, DR ORDER Per: B. Ravichandran The appellant is aggrieved by the order dated 15.07.2013 of Commissioner (LTU), New Delhi. The appellants are engaged in trading and transportation of natural gas. The appellants entered into contracts for sale of natural gas with various clients. They have transported the gas for sale up to the point of delivery. In terms of agreement, the appel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ndertaken by the appellant was only on account of the obligation in the sale contract. Such activity is in the nature of service to the self and not service to any other person. Thus it is the case of the appellant that the entire contract value is towards sale of goods and there is no question of any Service Tax on any part of the consideration. In any event, the ld. Counsel submitted that marketing margin is an element completely attributable towards cost price of gas and it has nothing to do with transportation charges. The appellant did not charge any marketing margin where they under take only transportation of gas. For sale of gas involving transportation, marketing margin is charged as per industry practise. The collection of marke ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ordingly cannot be considered as price of gas. 7. We have heard both the sides and perused the appeal records. The only point of dispute is the liability of the appellant to pay Service Tax of marketing margin indicated in their sale invoices of natural gas. The Revenue contended that marketing margin is relatable to the activity of transportation of gas. We are not in agreement with such proposition. The admitted facts are that appellants are engaged in marketing natural gas. They have pipelines for transmission of these natural gas to various destinations. They have entered into gas sales contract with their clients. A perusal of sample sales contract will indicate that the sale of such gas gets effected at the delivery point to the cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the customer and transportation of gas is at the risk of the appellant, we find that there is no service element attributable to the consideration received as marketing margin. As already noted that the original authority apparently gave finding on the tax liability because the transportation charges are suffering Service Tax in respect of sale transaction. This by itself will not justify the Service Tax liability on marketing margin. There is no service by the appellant to the buyer of gas, independent to the sale transaction, as the sale transaction and the delivery point has been clearly defined in terms of the contract. The value liable to VAT is also clearly identified. The marketing margin is considered as part of sales transaction v ..... X X X X Extracts X X X X X X X X Extracts X X X X
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