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TMI Blog2018 (2) TMI 317X X X X Extracts X X X X X X X X Extracts X X X X ..... ch would augment or enhance or supplement the business of the client, which would obviously result in improvement of the business income/profit of the client. In cases, where there is promotion or marketing of services, or provision of service on behalf of the client, there is more often an arrangement by which the service provider takes or is given the responsibility for increasing the scope for the service activity of the client, generally in a specific geographical area. No portion of the container freight services (CFS) chargers and Cargo Receipt or CR Charges received by the appellants from the Indian exporters of cargo are alleged to have been remitted or transferred to the foreign client to APL WMS HKL - no portion of the amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... confirmed differential tax liability of ₹ 1,12,03,673/- along with interest liability thereon and penalties under various provisions of law. Hence, this appeal. 2. On 01.01.2009, when the matter came up for hearing on behalf of the appellants, Shri Prasad Paranjape made oral and written submissions, which can be broadly summarised as under:- (a) The nature of services provided by them are absolutely in the nature of handling export cargo. The services of the appellant commence right from the stage of cargo delivery in the warehouse till it is loaded in the ocean going vessel. (b) The scope of services rendered by the appellants and for which they are paid are in the nature of Cargo Handling Services. Further, the definiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that was to be so, then the charges for the impugned services would have been first accounted as income in the books of foreign logistics company and then the same would have been accounted as payable to the appellant. Since, in the present case, the entire income is booked by the appellants as their own income, the Revenue's reliance on clause 3.1 of the Agreement, dated 28 th Dec. '02, is erroneous and not sustainable. (e) Even applying the principles of classification as enumerated under section 65A of the Finance Act, 1994, the correct classification for the services rendered by the appellants will be Cargo Handling Service. They draw support for these averments on the basis of CBEC Circular No.59/8/03, dated 28.06.2003, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e payment by the appellants under the categories. (h) Even assuming without admitting that the services provided by them will qualify as Business Auxiliary Service e, since the said services are provided to overseas logistic companies, the same will qualify as export of services and not liable to service tax following the ratio of various Tribunal and High Court decisions as under:- (i) Commissioner of Service Tax, Mumbai-II Vs SGS India Pvt. Ltd., reported in 2014 (34) S.T.R. 554 (Born,); and (ii) Vodafone Essar Cellular Ltd. Vs Commissioner of Central Excise, Pune-III reported in 2013 (31) S.T.R. 788 (Tri. -Mum). 3. 1 On the other hand, learned departmental representative Shri K.P. Muralidharan supports the adjudica ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt, which would obviously result in improvement of the business income/profit of the client. In cases, where there is promotion or marketing of services, or provision of service on behalf of the client, there is more often an arrangement by which the service provider takes or is given the responsibility for increasing the scope for the service activity of the client, generally in a specific geographical area. The additional income that accrues out of such Business Auxiliary Service is provided to the client. On account of such Business Auxiliary Services done by the service provider, very often routed through the said service provider, there will be obviously a payment or consideration for such services rendered, in the nature of fees or a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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