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TMI Blog2024 (4) TMI 821X X X X Extracts X X X X X X X X Extracts X X X X ..... the Service Tax Audit was initiated for the period 2015-16 to 2017-18 (upto June 2017) by the Department against the appellant. A letter was issued for submissions of the documents. The appellant supplied the documents and it was observed that the appellant has obtained the Service Tax Registration under Section 65 (105)(h) of the Act. In the balance sheet and trading/profit and loss account for the relevant period, they have declared the gross amount charged to their clients an amount of Rs.21,74,65,342/- and an amount of Rs.20,71,78,011/- as reimbursable expenses. However, the appellant has declared taxable value as Rs.3,13,96,519/-. 2.1 The case of the Revenue is that the appellant has incurred expenses showing reimbursable expenses but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oth the parties and considered the submissions. 6. We find that the appellant has claim that they are the pure agents. In support of their claim, the appellant has filed various agreement with their Principal, which shows that the appellant is the pure agent and all the expenses of Principal are for taking and delivery of the goods, for making payment for transportation, freight of clearing and forwarding services for the purposes of agency. All the charges paid are to be reimbursed to the appellant on actual basis as the appellant is a pure agent. For better appreciation, one of such agreement is extracted here : 7. On going through the agreement itself, we find that the appellant is only pure agent and all the ex ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f service tax. 15. We observe that Service tax (Determination of Value) Rules, 2006, has brought in the concept of 'Pure Agent' to address the taxability issues of reimbursements. As per the said Rules, expenditure incurred as a 'Pure Agent' were excluded from the assessable value. In the present matter under dispute, a perusal of the agreements entered with the different principals clearly revels that there were specific amounts for remuneration to be charged as a C&F Agent. We also observe that the Respondent has recovered precisely the same amount from the recipient that has been paid on their behalf by producing the documentary evidence in regard to such expenditure. Thus, it is clearly established that the Respondent has acted as &# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 67. Clause (i) of sub-section (1) of Section 67 provides that the value of the taxable service shall be the gross amount charged by the service provider "for such service". Reading Section 66 and Section 67(1)(i) together and harmoniously, it seems clear to us that in the valuation of the taxable service, nothing more and nothing less than the consideration paid as quid pro quo for the service can be brought to charge. Sub-section (4) of Section 67 which enables the determination of the value of the taxable service "in such manner as may be prescribed" is expressly made subject to the provisions of sub-section (1). The thread which runs through Sections 66, 67 and Section 94, which empowers the Central Government to make rules for carrying ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e legislation. 18. We observe that the ratio of the decision in the case INTERCONTINENTAL CONSULTANTS & TECHNOCRATS PVT. LTD. Versus UNION OF INDIA [2013 (29) S.T.R. 9 (Del.), squarely applicable in this case. We observe that the adjudicating Authority has dropped the demand made in the Notice on the ground that the remuneration for C&F work and reimbursement for miscellaneous activities have been separately mentioned against specific items and they got reimbursement on actual basis. The decisions cited above clearly supports the view taken by the adjudicating authority in the impugned order. Accordingly, we hold that there is no infirmity in the impugned order and uphold the same. 19. In view of the above discussion, we uphold the im ..... X X X X Extracts X X X X X X X X Extracts X X X X
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