Tribunal rules commission-based order procurement not C&F Agent service

The Tribunal ruled in favor of the appellant in an appeal against a demand for service tax prior to 1-7-2003 for providing Clearing and Forwarding Agent services. The Tribunal found that the appellants, who procured orders on a commission basis, did not provide C&F Agent services. Relying on precedents, the Tribunal held that mere order procurement on a commission basis did not constitute C&F Agent service, setting aside the impugned orders and allowing the appeals.

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Issues involved: Appeal against demand of service tax prior to 1-7-2003 for providing Clearing and Forwarding Agent service.

Analysis:
1. The appellant contested the demand of service tax before 1-7-2003, arguing that post that date, service tax was imposed on commission agents. The revenue contended that as the appellants procured orders and assured payment, they provided Clearing & Forwarding Agent services.

2. The Tribunal noted that the appellants only procured orders on a commission basis, not providing C&F Agent services. Referring to the decision in Larsen & Toubro Ltd. v. CCE and CCE v. United Plastomers, the Tribunal held that mere order procurement on commission basis did not constitute C&F Agent service.

3. Considering the settled position by the Larger Bench and the High Court, the Tribunal set aside the impugned orders and allowed the appeals, ruling in favor of the appellant.

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