Commission agent exemption for IMFL sales commission applied, excluding service tax under Business Auxiliary Service.

Commission received for sale of IMFL was held not exigible to service tax under Business Auxiliary Service because the contractual arrangement treated the recipient as a commission agent and the consideration was linked to sales. The first appellate authority applied the definition of Commission Agent in Notification No. 13/2003-ST dated 20.06.2003 and relied on Tribunal decisions supporting that interpretation. The recipient was therefore covered by the notification for the relevant period, no service tax liability arose on the commission amount, and the Revenue's appeal failed.

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Issues: Whether commission received for sale of IMFL during the relevant period was exigible to service tax under Business Auxiliary Service, or whether the respondent was covered as a Commission Agent under Notification No. 13/2003-ST dated 20.06.2003.

Analysis: The agreement with the IMFL manufacturers showed that the respondent was to receive consideration as commission, determined on the basis of the quantum of sale or purchase. The first appellate authority had relied on the definition of Commission Agent in the exemption notification and the nature of the contractual arrangement. On that basis, the respondent was held to fall within the notification for the period in question, and the cited Tribunal decisions were found to support the same view.

Conclusion: The respondent was covered by Notification No. 13/2003-ST dated 20.06.2003, no service tax liability arose on the commission amount, and the Revenue's appeal failed.

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