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TMI Blog2018 (12) TMI 1778X X X X Extracts X X X X X X X X Extracts X X X X ..... vice Tax of Rs. 2,05,11,753/- after deducting the values realized towards Statutory Expanses such as Cess, Customs Duties, Port Duties, etc and also values relized towards general charges, labour charges, transportation, miscellaneous charges, sea and air freight charges, drawback claim, go-down rent, service charges etc. (collectively the other charges), incurred by them on such reimbursement. They were also the recipient of Good Transport Agency Service. Show Cause Notice dated 16/10/2007 was issued alleging short payment of Service Tax during the period from 2002-03 to 2005-06 under the category of "CHA Service", short payment of Service Tax @ 8% instead of 10.2% for the period from 10/09/2004 to 15/09/2004 on the taxable value of Rs. 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... CHA and the computation of service tax thereof. (iii) The amounts reimbursed by the clients of the respondent against various other expenses are not actual amounts of the expenses incurred by the respondent. The expenses incurred are debited to the Profit & Loss amount and therefore should be treated as the assessee's expenses for running his business and the amount realized on profit basis should be treated as value received for providing taxable services. 2. The Respondent assessee has filed Cross Objection being CO No.53/2009 against this appeal. 3. The Ld. DR appearing on behalf of the appellant Department reiterates the grounds of appeal and submits that the Adjudicating Authority has erred in not confirming the Service Tax and E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of taxable services referred to in sub-clauses (a), (d), (e), (f), (g), (h), (i),..................(zzzzv) and (zzzzw) of clause (105) of section 65 and collected in such manner as may be prescribed. 6.3 Section 67: Valuation of taxable services for charging service tax For the purposes of this Chapter, the value of any taxable service shall be the gross amount charged by the service provider for such service provided or to be provided by him. Explanation 1.-For the removal of doubts, it is hereby declared that the value of a taxable service, as the case may be, includes,- a) The aggregate of commission or brokerage charged by a broker.......; b) The adjustments made by the telegraph authority....; c) The amount of prem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e practice obtaining is to show the charges for services as "agency commission", "charges", "agency and attendance charges", "agency charges" and some similar descriptions. The service tax will be computed only with reference to such charges. In other words, payments made by CHA on behalf of the client, such as statutory levies (cess, Customs duties, port dues, etc.) and various other reimbursable expenses incurred are not to be included for computing the service tax." 6.5 Meaning of "consideration": The term 'consideration' was not used in the valuation provision, during the material period. The term was defined for the first time in 2006 in Explanation (a) of Section 67 in the following manner- As applicable w.e.f 18.04.2006 till 13.05. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or coverage of expense reimbursement, billing, break up of bull fees, sea freight, airline commission, freight rebate and unallocated income under Customs house agent service - Order not speaking and bad in law - Section 33A of Central Excise Act, 1944 as applicable to Service Tax vide Section 83 of Finance Act, 1994. The Income arising from reimbursable expenses when charged on a notional or equalized basis is not chargeable to service tax in the light of Board's Circular dated June 6, 1997 in the light of the following judicial decisions:- (a) Baroda Electric Meters Ltd.- 1997 (94) ELT 13 (SC); (b) Indian Oxygen Ltd.- 1988 (36) ELT 723 (SC) (ii) Bax Global India Ltd. Commissioner of Service Tax [2007 (10) TMI 132, CESTAT, Bangalor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... time of introduction of levy of service tax on services rendered by customs house agent, on the basis of Circular No. F. No. B43/1/97-TRU, dated 06.06.1997 Trade Note No.39/97 dated 11.6.1997 was issued by Delhi Commissionerate. It explained the role of CHA and also had laid down the procedures to be followed. In another Circular No.119/13/2009-ST dated 21.12.2009, CBEC clarified the position further. In paragraph 3 of the Circular, it was observed and reported that Board had clarified on 06.06.1997 that service tax would be charged on the service charges only and statutory levy and other reimbursable charges would not be included in the taxable value Present Status: Affirmed by Hon'ble SC vide Order dated 16.07.2018, reported in 2018 ( ..... X X X X Extracts X X X X X X X X Extracts X X X X
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