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TMI Blog2025 (1) TMI 1375X X X X Extracts X X X X X X X X Extracts X X X X ..... re Agents Service [DCA]. - As a C&F Agent, M/s.RR polymers was providing the services of receiving, storing/warehousing and clearing / forwarding of good i.e. High Density Polyethylene belonging to M/s.Haldia. - As a Del Credere Agent, they procured orders from the prospective buyers (final customers) on behalf of M/s.Haldia and M/s.Haldia delivered the goods directly to the buyers. M/s.RR Polymers was paid with commission by M/s.Haldia for the services rendered by them. In respect of rendering service in the category of 'C&F Agent', they were paid a commission of Rs.550/-- per MT. In respect of rendering service in the category of 'Del Credere Agent', they were paid a commission of Rs.350/-- per MT. 2. The case of the Revenue is that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which appeared to be the early payment receipts shown in the P&L Account as discount receipts on which the appellant was liable to pay service tax under the category of "Business Auxiliary Service" [BAS for short]. Accordingly, a SCN dt. 19.10.2012 came to be issued by invoking the extended period of limitation for the reasons that the information relating to receipt of incentive in the name of discounts was within the exclusive knowledge of the appellant; the appellant had fully and knowingly suppressed the above facts from the knowledge of the department by not declaring the receipt of incentive in its ST--3 returns. In its reply, the noticee/appellant appears to have replied that they were the approved Consignment Stockiest Agent as well ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e or other discounts were not the discounts offered by the service provider to the service recipient on provision of services but in fact, the consideration given by the service recipient to the service provider which were reflected as income for the service provider was earned for the provision of service. There is also an observation as to the admission of the Appellant that it took advantage of cash discounts offered by M/s.Haldia, they raised temporary loans through OD facility and raised credit limits with banks, settled payments in advance, etc. for which the appellant was receiving early payment incentives regularly, which was credited to the discount receipts and payments account. The above discussion prompted the Adjudicating Autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid by the appellant only and had the appellant received the advance from such end customers, only then would it have passed on the early payment discount to such end customers. Moreover, the early payment discount received from its principal could not be equated with commission so as to attract service tax liability since, admittedly, the appellant had discharged the service tax liability on the commission which was received separately. Hence, there was no link between the commission paid to the appellant at fixed rates for the sale amount and cash discount offered in the name of incentive for making early payments. Early payments were not made in every bill and only in such cases where they made early payment, such discounts were offered ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the show cause notice under Section 73(1) of the Finance Act, 1994. When clearly the above facts are picked up from the scrutiny of the financial records of the appellant, there cannot be an allegation as to suppression since the suppression would be of something which was not disclosed anywhere in the financial records, which was unearthed by the Revenue, which is not the case here. There is also no specific logical finding that the early payment incentive received by the appellant was liable to service tax other than mentioning that the same was liable to service tax under BAS. Hence, we are of the view that the Revenue has failed to make out a case for invoking the larger period of limitation and that too, to demand service tax which ..... X X X X Extracts X X X X X X X X Extracts X X X X
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