2015 (12) TMI 273 - AT - Service Tax

CESTAT Mumbai: Appellant wins service tax case on commission received from company

The Krushak Seva Sahayya Samiti Trust Versus Commissioner of Central Excise, Aurangabad

The Appellate Tribunal CESTAT MUMBAI ruled in favor of the appellant regarding the service tax liability on commission received from a company. Citing a ... Discharge of service tax liability - Business Auxiliary Service - Held that:- amount received by the appellant has been recorded as an income under the category of commission; hence, service tax liability arises under the “Business Auxiliary Service”. The lower authorities have rejected the contention raised by the appellant that no service tax liability arises on this amount on the ground that once the appellants received commission, they are liable to discharge the service tax liability. - appellant is transporting sugarcane from the farmers fields to the sugar factory and the ratio of the Tribunal decision in the case of Dnyaneshwar Trust (2014 (1) TMI 90 - CESTAT MUMBAI) will directly apply. Accordingly, the impugned order is set aside - Decided in favour of assessee. Issues Involved:Discharge of service tax liability on commission received from a company.Analysis:The judgment by the Appellate Tribunal CESTAT MUMBAI dealt with the issue of service tax liability concerning the commission received by the appellant from a company during the period 2005-06 to 2006-07. The Revenue argued that the amount received as commission should be subject to service tax under the category of 'Business Auxiliary Service.' The lower authorities rejected the appellant's contention that no service tax liability arises on this amount. The Tribunal referred to a previous case, Dnyaneshwar Trust Vs. CCE, Mumbai, where a similar issue was addressed. In that case, it was held that the appellant, engaged in activities related to sugarcane transportation, was entitled to exemption under Notification No. 13/2003-S.T. for 'Business Auxiliary Service' provided by commission agents in respect of agricultural products. The Tribunal found that the appellant in the current case was also involved in transporting sugarcane, and thus, the decision in Dnyaneshwar Trust applied directly. Consequently, the impugned order was set aside, and the appeal was allowed with any consequential relief deemed necessary.