Incidental freight and delivery charges on sale of goods were not Business Support Service, as no separate service relationship existed.

Freight and delivery charges retained by a manufacturer for arranging transport of excisable goods to buyers' premises were held not to be taxable as Business Support Service. The transport arrangement was only incidental to delivery of duty-paid goods under the sale transaction, and the invoices did not show any separate service provider-service receiver relationship. Because the activity merely facilitated supply and did not amount to supporting the buyer's business, the service tax demand was unsustainable. The impugned order was set aside and the appeal was allowed.

---

---

Issues: Whether the freight and delivery charges retained by a manufacturer for arranging transport and delivery of excisable goods to buyers' premises are liable to service tax as Business Support Service.

Analysis: The appellant was a manufacturer selling excisable goods and there was no separate arrangement showing a service provider and service receiver relationship over and above the sale of goods. The invoices disclosed transportation cost as part of the supply transaction, and the transport arrangement was only to facilitate delivery of duty-paid goods to the buyers' premises. Such incidental facilitation did not amount to supporting the buyers' business and did not fit the definition of taxable service under Business Support Service.

Conclusion: The demand of service tax was unsustainable and the issue was decided in favour of the assessee.

Final Conclusion: The impugned order was set aside and the appeal was allowed.

Ratio Decidendi: Where transportation arranged by a seller is only incidental to delivery of goods sold and does not create an independent service relationship, the amount charged for such delivery cannot be treated as Business Support Service.

---