AI Drafter 
TaxTMI 
TaxTMI 
2018 (5) TMI 671
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....be included in the taxable value for the purpose of calculation of service tax. 2. The respondent is a clearing and forwarding agent on behalf of M/s. Chettinad Cement Corporation Ltd., Chennai. They were paying service tax on the service charges received by them at Rs. 5.00 per MT, which includes service tax as per the agreement entered with their principal. As it appeared that the respondent were not paying service tax on the amount of service charges/commission received from the principals, a show-cause notice was issued to them demanding service tax alleging that reimbursable expenses such as loading, unloading, transportation (freight) and other expenses that are initially incurred by the C & F Agent on behalf of the principals and ....
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....he case of CST vs. M/s. Sangamitra Service Agency (supra), the Hon'ble Madras High Court has held as below: "6. Aggrieved by this, the present appeal has been preferred by the Revenue. Learned Standing counsel appearing for the Revenue submitted that as per the provisions of Rule 6(8) of Service Tax Rules, 1994, the value of taxable service in relation to the services provided by the Clearing and Forwarding Agent to the client for rendering services of Clearing and Forwarding operations, in any manner, shall be deemed to be the gross amount of remuneration or commission (by whatever name called) paid to such agent by the client, engaging such agent. He further submitted that considering the charges collected towards freight, labour....
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....er to fall under the expression "remuneration or commission", we have no hesitation in rejecting the Revenue's contention. Accordingly, the Civil Miscellaneous Appeal is dismissed. No costs." 6.1 We also find that the issue is also covered by judgment of Hon'ble Supreme Court in the case of UOI vs. M/s. Intercontinental Consultants and Technocrats Pvt. Ltd. wherein the Hon'ble Court has held as below: "(21) Undoubtedly, Rule 5 of the Rules, 2006 brings within its sweep the expenses which are incurred while rendering the service and are reimbursed, that is, for which the service receiver has made the payments to the assessees. As per these Rules, these reimbursable expenses also form part of 'gross amount charged'. Theref....
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....r providing such taxable service cannot a part of that valuation as that amount is not calculated for providing such 'taxable service'. That according to us is the plain meaning which is to be attached to Section 67 (unamended, i.e., prior to May 01, 2006) or after its amendment, with effect from, May 01, 2006. Once this interpretation is to be given to Section 67, it hardly needs to be emphasised that Rule 5 of the Rules went much beyond the mandate of Section 67. We, therefore, find that High Court was right in interpreting Sections 66 and 67 to say that in the valuation of taxable service, the value of taxable service shall be the gross amount charged by the service provider 'for such service' and the valuation of tax ser....
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....ahal Hotel: "the Rules were meant only for the purpose of carrying out the provisions of the Act and they could not take away what was conferred by the Act or whittle down its effect." 29) In the present case, the aforesaid view gets strengthened from the manner in which the Legislature itself acted. Realising that Section 67, dealing with valuation of taxable services, does not include reimbursable expenses for providing such service, the Legislature amended by Finance Act, 2015 with effect from May 14, 2015, whereby Clause (a) which deals with 'consideration' is suitably amended to include reimbursable expenditure or cost incurred by the service provider and charged, in the course of providing or agreeing to prov....
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.... its provenance, layout and features as also in the implication as to its meaning that arise by presumptions as to the intent of the maker thereof. 28. Of the various rules guiding how a legislation has to be interpreted, one established rule is that unless a contrary intention appears, a legislation is presumed not to be intended to have a retrospective operation. The idea behind the rule is that a current law should govern current activities. Law passed today cannot apply to the events of the past. If we do something today, we do it keeping in view the law of today and in force and not tomorrow's backward adjustment of it. Our belief in the nature of the law is founded on the bedrock that every human being is entitled to arra....