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TMI Blog2023 (5) TMI 605X X X X Extracts X X X X X X X X Extracts X X X X ..... atutory book, therefore, the question of demanding service tax for the period prior to 01.07.2003, does not arise - for the period prior to 01.07.2003, the appellant was not liable to pay service tax. Therefore, the said issue is answered in favour of the appellant. Whether the demands raised against the appellant are barred by limitation or not? - HELD THAT:- It is fact on record that the audit took place on 2nd February, 2005 and 6th October, 2005 for the period 2003- 04 and 2004-05 respectively (impugned period) and a show-cause notice has been issued to the appellant on 26.09.2008 as it is not a case of suppression of facts by the appellant and all the facts are in the knowledge of the Department, therefore, we hold that all the demands are barred by limitation as the show-cause notice has been issued by invoking extended period of limitation - the said issue is also answered in favour of the appellant. Whether in the facts and circumstances of the case, the appellant is liable to pay interest on the impugned demand and is to be penalized or not? - HELD THAT:- As the demand is not sustainable against the appellant, therefore, the appellant is not required to pay any i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n by the appellant passed the impugned order confirming demand of service tax of Rs.1,32,42,153/- along with interest and penalties under various Sections of the Finance Act, 1994. 5. Aggrieved by such order, the appellant is before us. 6. Shri A.K.Prasad, Ld.Advocate appearing on behalf of the appellant, submits that prior to 01.07.2003, they were not liable to pay service tax as Business Auxiliary Service but for the period post 01.07.2003 to till 08.07.2004, the said service was not taxable. It is his contention that they were entitled to get the benefit of Notification No.13/2003-ST dated 20.06.2003. He also submits that the Audit took place on 02.02.2005 and 06.10.2005 for the period 2003-04 and 2004- 05 respectively. During the Audit, they had provided of material records, namely, balance sheet, service tax returns and payments of service tax made by them. The show-cause notice has been issued on 26.09.2008. The said show-cause notice is barred by limitation. Finally, he relies on the decision of the Tribunal in the case of Brindco Sales Limited Vs. Commissioner of Service Tax, Delhi reported in 2015 (40) STR 986 (Tri.-Del.). He also relies on the decision of the Trib ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s on behalf of the client ; or (vii) provision of service on behalf of the client ; or (viii) a service incidental or auxiliary to any activity specified in sub-clauses (i) to (vii), such as billing, issue or collection or recovery of cheques, payments, maintenance of account and remittance, inventory management, evaluation or development of prospective customer or vendor, public relation services, management or supervision. On going through the said definition, we find that the activity taken by the appellant, is squarely covered under the definition of Business Auxiliary Service as provided under Section 65 (19) of the Finance Act, 1994. Further, we find that the Notification No.13/2003-ST dated 20.06.2003 came into effect, which is reproduced below : Business auxiliary services provided commission agents - Exempted In exercise of the powers conferred by Section 93 of the Finance Act, 1994 (32 of 1994), the Central Government, being satisfied that it is necessary in the public interest so to do, hereby exempts the business auxiliary services provided by a commission agent from the service tax leviable thereon under sub-section (2) of Section 66 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s own cost to ensure smooth functioning of the stocking and distribution of the products. KAM shall however be free to engage additional manpower that may be required with a cost to be borne by KAM. 9. COMMISSION AGENT undertakes to invest/fund amount (required to be deposited for issue of Transport Passes to Trade/Institutions) at any point of time. Further COMMISSION AGENT undertakes to provide more funds (if mutually agreed) considering the growth in the volume or change in excise levies. 10. COMMISSION AGENT shall obtain such permissions, licenses and/or registrations and comply with such regulations as may be required from the Government/Local Bodies or any other Authority. 11. COMMISSION AGENT shall forthwith forward to KAM all documents, papers, orders, notices, etc. addressed to KAM and received by the COMMISSION AGENT for necessary action. 12. COMMISSION AGENT shall bear and pay all rents, electricity, water and other charges and outgoing including local and municipal taxes and levies in respect of the Depot. Paragraph (c) of the Agreement reads as under : c) In consideration of the above functions, to be carried by COMMISSION AGENT on behalf ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... held to be covered under BAS by the adjudicating authority) that would not debar it from being called commission agent as the said Notification neither expressly nor impliedly states that a commission agent should not render any service which is not within the purview of a commission agent. 6. 7. We find that primary adjudicating authority has denied the benefit of Notification No. 13/2003-ST to the appellant essentially by noting as under : 21.2 . However, if a service provider is primarily engaged in business promotion and sale is just a consequence of the various activities undertaken by him, it could not be considered that he is a commission agent primarily causing sale. The definition of commission agent in this notification would not cover a person who is primarily engaged in business promotion and not confined to sale of the goods. 21.3 ........ However, in the present case, the various activities undertaken by M/s. BSL are beyond the scope of function of commission agent. They are providing promotional activities, infrastructural support, promotional event management. Further since BSL was acting as Del Crederer f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n received by the appellant was based on the quantum of the goods sold. Therefore it satisfied the requirements of being categorised as commission agent as per the definition given in the said Notification. Though, admittedly, the appellant was rendering several other services also (all of which have been held to be covered under BAS by the adjudicating authority) that would not debar it from being called commission agent as the said Notification neither expressly nor impliedly states that a commission agent should not render any service which is not within the purview of a commission agent. In this case also, the appellant has affected the sales on behalf of third party and received commission which is covered as commission agent in terms of the Notification No.13/2003-ST dated 20.06.2003. 12. Therefore, following the decision of Brindco Sales Ltd. (supra), we hold that the appellant was not liable to pay service tax under the category of Business Auxiliary Service as commission agent during the period 01.07.2003 to 08.07.2004. The issue is answered in favour of the appellant. Issue No.(b) 13. It is fact on record that prior to 01.07.2003, Business Auxi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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