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TMI Blog2018 (8) TMI 1108X X X X Extracts X X X X X X X X Extracts X X X X ..... nsidered by the Tribunal in the case of Phoenix International Freight Services Pvt. Ltd. [2016 (9) TMI 585 - CESTAT MUMBAI], where it was held that in such activity of booking of cargo spaces, the assessee is not rendering any service either to the shipping line or to the customers and the activity cannot be taxed under Business Auxiliary Services. The demand cannot sustain - appeal dismissed - decided against Revenue. - Appeal No. ST/188-189/2012, Appeal No.ST/206,207/2012 - Final Order No. 42216-42219/2018 - Dated:- 7-8-2018 - Hon ble Ms. Sulekha Beevi C.S. Member ( Judicial ) And Hon ble Shri V. Padmanabhan, Member ( Technical ) Shri K. Veerabadra Reddy, JC ( AR ) For the Revenue Shri N. Viswanathan For the Assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... le confirming the demand under Business Auxiliary Service for the period from 1/10/2004 to 30/4/2006, the adjudicating authority excluded the freight charges and the tax was levied only on the mark up value /excess freight collected by the appellant. The department has filed the appeal aggrieved by such exclusion of freight charges. It is the case of the department that the adjudicating authority failed to see that the entire amount would be subject to levy of service tax for the reason that these activities would fall under managing logistics and distribution services. The assessee is in appeal against the confirmation of demand, interest and the penalties imposed. 3. On behalf of the assessee, the Ld.Counsel, Sh.N.Viswanathan submitted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... badra Reddy supported the grounds of appeal in the appeal filed by the department. He submitted that the adjudicating authority has confirmed the tax under Business Auxiliary Services from 1/10/2004 to 30/4/2006, but has however excluded the excess freight collected by the appellant for this period. After 1/5/2006 the adjudicating authority has confirmed the demand of service tax on the gross amount of freight collected. The adjudicating authority has erred in excluding the excess freight collected by the appellant for the period prior to 1/5/2006. He adverted to the Show cause notice and submitted that CBEC vide Circular No.59/8/2003-ST dt.20/6/2003 had clarified that activities like managing distribution and logistics would fall under Bus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dditional amount from their clients on the space which has been booked by the appellant with particular shipping lines. Under this category, the appellant books space in advance in a shipping line, and as per the requirement of the customers sells the space to the customers in a particular shipping line at a premium or profit, i.e., appellant books the space in advance with the shipping line, say for ` 100/- per sq. ft. and sells the space to any of the customers who would like to use the space at ` 115/- per sq. ft. The additional amount of ` 15/- earned by the appellant is being regarded by him as a profit in trading and selling of space. Revenue s contention is that this amount is for the services rendered to the client. In our considere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... couraging the various clines for booking the space in a specific airline, we do not find any merits in the submission made by the learned Counsel on this point and we hold on merits against the appellant on this issue. 8. Similarly in the case of Greenwich Meridian Logistics India Pvt. Ltd., the Tribunal observed as under :- 10. The original authority has proceeded on the assumption that there is only one payment and, that too, for freight charged by the shipping line. He has rejected the possibility of trading in space or slots on vessels by holding that trading in space or slots is a figment and freight is all that is transacted. This is a patent misconstruing of the usage of that expression. Freight, though used colloquially to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... kes responsibility for safety of goods and issues a document of title which is a multi-modal bill of lading and commits to delivery at the consignee s end. To ensure such safe delivery, appellant contracts with carriers, by land, sea or air, without diluting its contractual responsibility to the consignor. Such contracting does not involve a transaction between the shipper and the carrier and the shipper is not privy to the minutiae of such contract for carriage. The appellant often, even in the absence of shippers, contract for space or slots in vessels in anticipation of demand and as a distinct business activity. Such a contract forecloses the allotment of such space by the shipping line or steamer agent with the risk of non-usage of the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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