Service tax on clearing and forwarding services: incidental charges may be excluded from taxable value at the pre-deposit stage.

Service tax on clearing and forwarding services was examined in relation to whether incidental receipts such as loading expenses, service charges and godown charges formed part of the taxable value, or whether tax was confined to the commission component alone. The interim order treated the appellants' contention, a contemporaneous prima facie view of another Bench, a trade notice, departmental clarification and the reading of Rule 6(8) of the Service Tax Rules, 1994 as sufficient to support waiver at the pre-deposit stage. Full waiver of pre-deposit was granted and recovery was stayed pending disposal of the appeal.

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Issues: Whether the appellants were entitled to full waiver of pre-deposit in relation to the demand of service tax on loading expenses, service charges and godown charges included in the value of services rendered as clearing and forwarding agents.

Analysis: The order noted the appellants' contention that service tax was payable only on the commission received and not on incidental charges such as loading expenses, service charges and godown charges. It also took note of the contemporaneous prima facie view expressed by another Bench, along with the trade notice, departmental clarification and the interpretation placed on Rule 6(8) of the Service Tax Rules, 1994, and held these materials sufficient for considering waiver at the interim stage.

Outcome: Full waiver of pre-deposit was granted and recovery was stayed until disposal of the appeal.

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