2015 (10) TMI 1111

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....buying and selling of cards, when the fact remains that there is no sale involved and only commission was paid by the BSNL to the franchisees and 2. Whether in the facts and circumstances of the case the Appellate Tribunal is right in deciding the case in favour of the assessee based on a decision given by the Bangalore Tribunal wherein the existence of a Franchisee Agreement was not brought to the attention of the Tribunal " 2. The brief facts of the case is that, " (i) Intelligence was gathered that M/s. Bharat Cell, Coonoor, a franchisee of BSNL, was authorised to trade in pre-paid BSNL cards. As per para 8.1 of agreement made between the assessee and BSNL, BSNL have agreed upon distributing the following commission ....

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..... 1,65,330/- and E.Cess-Rs. 2,409/-). Though the assessee hold centralized registration for payment of service tax, it was noticed that they have not paid Service Tax on the Commission received on the prepaid cards as listed by BSNL and had not followed the procedures laid down under the Service Tax Rules. As it appeared that the service offered by the assessee for sale of prepaid cards of BSNL for a commission would get covered under the Business Auxiliary Services and the service tax is payable on the commission received by the assessee, a show cause notice dated 07.07.2005 was issued to the assessee. After due process of law, the Adjudicating Authority vide his order dated 06.06.2007, confirmed the demand of service tax of an amount of R....

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....customers throught he distributor and then pays to the distributor out of consideration received by them from their customers on whcih consideration service tax is first discharged by BSNL. That is to say the transactions of both the parties are essentially one and payment on the full value of service occurs earlier thanpayment of commission to the distributor. Further payment of tax on full value of service rendered by the principal, that is BSNL, is easily verifiable unlike in the case of services rendered by many other sub-contractors for other type of services. 24. ... ... ... 25. Interestingly the above services as also the services of selling agent or a distributor of SIM cards or recharge coupon vouchers have been e....