Clearing and Forwarding Agent service requires core agency functions; mere coordination and delivery support do not qualify.

Contractual coordination with customers and transport agencies for delivery of goods, and assistance in the functioning of electronic energy meters, was held not to amount to Clearing and Forwarding Agent service. The agreement did not show the usual indicia of such service, including receipt of goods, warehousing, despatch on the principal's instructions, maintenance of stock records, or preparation of invoices. Reliance on an earlier departmental decision was also rejected because that decision had been overruled by a Larger Bench. The service tax demand therefore could not be sustained.

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Issues: Whether the appellant's contractual activities were taxable as services of a Clearing and Forwarding Agent.

Analysis: The agreement showed only co-ordination with customers and transport agencies for delivery of goods and assistance in functioning of the electronic energy meters, and did not indicate the normal functions of a clearing and forwarding agent such as receiving goods, warehousing, despatch on principal's directions, maintenance of stock records, or preparation of invoices. The Tribunal also noted that the departmental reliance on an earlier decision had become untenable because that decision had been overruled by a Larger Bench.

Conclusion: The appellant's activities did not fall within the taxable category of Clearing and Forwarding Agent services, and the demand could not be sustained.

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