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TMI Blog2024 (9) TMI 1360X X X X Extracts X X X X X X X X Extracts X X X X ..... nsignments of the exhibitors. The description as per Airway Bill reads as Exhibition cargo as for display purposes only . It would be pertinent to mention that the time sensitive documents, goods or articles would be such volume/ weight that an individual could handle the same and deliver it personally. The expression utilizing the services of a person to our view mean that the person here means an individual and not a juristic person. As is a trade practice and as suggested by the above definition, small goods or articles capable of being handled and delivered by an individual would be covered under the definition of courier service - Larger consignments howsoever may be time sensitive or the requirement for door-to-door delivery, would not be classified as courier services but as cargo. Another factor which is crucial to examine is that normally a courier agency aggregates small consignments of documents, goods or articles and there are different senders and the place of destination for door-to door delivery - when a courier agency service is provided for door-to-door delivery, all the transporters taking responsibility to deliver the consignment from the booking stage to the fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lant had provided the courier agency services for the whole amount as reflected in their ledger and suppressed the value for evading the service tax payable thereon and accordingly demanded service tax on the differential value between the ST-3 returns and the ledger income, raising a demand of service tax amounting to Rs. 2,82,62,810/- under proviso to Section 73(1) of the Finance Act, 1994 besides invoking Section 75 for demand of interest and Section 76 78 for imposing penal provisions. 2.3 The appellant in their reply to the show cause notice stated that the matter is basically for the reconciliation of figures between service tax returns filed and books of accounts; that their business consists of mainly three type of transactions ; (a) first type is the services as courier agencies where their bills are raised against customers and courier services are provided; that they have paid tax in respect of these transactions and filed returns; that these transactions are not in dispute. (b) that second type of transactions are the services provided by them as co-loader ; that the term co-loader is applied when the actual courier service to the customer is provided by another courier ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... export of cargo by air from one airport to another in a foreign country. They book space on aircraft operated by airlines like FedEx, Emirates, and Lufthansa, and these airlines charge the appellant according to their tariffs. The appellant then bills the exporter, adding a profit margin, but does not charge service tax since the transport of cargo by air or sea for export is exempted from service tax. The appellant operates on a principal-to-principal basis and is not an agent of any airlines, bearing the risk on behalf of the exporter. The dispute in the appeal concerns a demand for service tax on the export of cargo services due to difference between the appellant s income in books of accounts and service tax returns, where only courier agency services were declared. The tax authorities argue that the appellant s airport-to-airport cargo transport falls under courier agency services as defined in Section 65(33) of the Finance Act, 1994 on the basis of which the Commissioner of Service Tax, Ahmedabad, confirmed the demand in the impugned order. The appellant, however, asserts that their airport-to-airport transport of export cargo does not meet the definition of courier agency se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n-disputably transported the goods only and not provided the services of a courier agency. 4. On the other hand, Shri Rajesh Nathan, learned Asst. Commissioner, (AR) Argued on behalf of the Revenue and re-iterated the findings of the impugned order. He argued that the services rendered by the appellant were falling within the ambit of courier Agency Service . In this case, the main issue is whether the activities claimed to be of a co-loader and the air freight business of the assessee are taxable under the courier agency service. That, the appellant argued that the income from services provided to co-loaders and in their freight business were not taxable. based on the Central Board of Excise Customs Circular F.No.341/43.96-TRU dated 31-10-96, wherein it was clarified that services provided by co-loaders to courier agencies are not taxable. If the appellant have themselves worked as co-loaders for some other courier agency and collected some amount, they are not liable to pay service tax but where some documents, goods or articles, are given to them for transmission by their clients, to co-loaders, they are required to pay service tax. That Shri K.A. Shah, Proprietor, has deposed i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y them (The Freight Centre). M/s. Penta Freight Pvt. Limited has raised invoices to them and they raised bills to various exhibitors. (b) The second consignment claimed by the appellant was given to them by M/s.. Infinity Logistics (Mumbai based company) for around 250 tons of cargo from Hyderabad to Madrid, Spain. They received cargo from Infinity Logistics at Hyderabad air cargo complex and they further delivered the cargo to M/S. Federal Express Corporation. He further stated that for around 250 tons of this cargo they have raised invoices to M/s. Infinity Logistics; that they have neither charged nor collected service tax from M/S. Infinity Logistics around 250 tons of cargo from Hyderabad to Madrid, Spain. They received cargo from Infinity Logistics at Hyderabad air cargo complex and they further delivered the cargo to M/s. Federal Express corporation; that for around 250 tons of this cargo they have raised invoices to M/S. Infinity Logistics; that they have neither charged nor collected service tax from M/S. Infinity Logistics. 7. The Learned Commissioner has held that the impugned activities in the two consignments discussed above were of Courier Agency Service with the foll ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Secunderabad as a shipper; Isolux Ingenieria SA Spain, Madrid as a consignee and M/S. Infinity Logistics, Mumbai as issuing carrier's agent. The said assessee issued invoice to M/S. Infinity Logistics, Mumbai and charged on the basis of weight of the consignment. On verification of ledger account for the period 2008-09 in respect of M/s. Infinity Logistics, Mumbai it appears that the said assessee has raised invoices amounting to Rs. 2,12,38,241/- showing sales as International Courier (Mum). The assessee in reference to the above, has vide letter dated 24.12.2012 submitted as follows: As regards para 10 of the show cause notice, it is clear from reading of the facts reproduced therein that we had raised invoices against M/S. Infinity Logistics. M/s. Infinity Logistics is not the customer whose goods or documents were to be transported. As mentioned in para 10, the goods are of M/S. XL Telecom Energy Ltd., Secunderabad and were to be transported to Spain. The goods were transported through airway bill of M/s. Fedral Express Corporation and the airway bills were issued in the name of M/S. XL Telecom Energy Ltd. We had arrangement with M/s. Fedral Express Corporation and therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ghing 4600 Kgs. To 13800 Kgs. And Fedex Express has billed to the Appellant for these weights of 4600 Kgs to 13800 Kgs. and in the airway bill showing the shipper as XL Telecom Energy Limited Secunderabad and consignor M/s. Isolux Ingenieria, Spain with description of goods as Solar Photovoltaic Modules . 11. On examination of the documents issued for the above two consignments we are convinced that the consignments transported were Freight Cargo and not the courier consignments. We have a considered view that courier agency service is an alternate to postal service/ postal parcel service . The definition as provided under the Finance Act reads as under: 'courier agency' means any person engaged in the door-to-door transportation of time sensitive documents, goods or articles utilizing the services of a person, either directly or indirectly, to carry or accompany such documents, goods or articles; As interpreted by the Hon ble Gujarat High Court, for a person to fall within the ambit of courier agency as defined under Clause (33) of Section 65 of the Act, the following ingredients would be required to be satisfied : (i) Such person should be engaged in door-to-door transpor ..... 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