TaxTMI 
TaxTMI 
2018 (10) TMI 475
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....ssee. Hence, the present appeal before the Tribunal. 4. The Ld. Advocate appearing on behalf of the appellant submits that the demand has been made holding the appellant as a consignment agent covered under the category of "Clearing and Forwarding Services" and hence, liable to pay Service Tax. It is his submission that as per the agreement with M/s. Indian Cement Ltd., the appellant is obliged to undertake the services of unloading at the goods-sheds, transportation at goods-sheds, unloading at the go-down and loading from go-down and as such the appellant is only responsible for clearing services only and not for forwarding services. Further, the Ld. Advocate argued that the sale of goods is effected by the appellant on his own and they are not under any obligation to sell the goods as per the direction of the principal. As per the trade parlance, consignment agent job's is to receive the goods from the principal and dispatch the same on the direction of the principal. But in the instant case, no instruction has been given and the appellant is not under obligation to dispatch goods to any specified person as per the instruction of the principal. The Ld. Advocate also contend....
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....and forwarding operations, which have bearing on the movement of goods. It also mentioned that normally a C&F Agent undertakes the following activities : (i) receiving the goods from the factories or premises of the principal or his agents; (ii) warehousing these goods; (iii) receiving despatch orders from the principal; (iv) arranging despatch of goods as per the directions of the principal by engaging transport on his own or through the authorized transporters of the principal; (v) maintaining records of the receipt and despatch of goods and the stock available at the warehouse; and (vi) preparing invoices on behalf of the principal. 8. Since the appellant in that case was engaged only for procuring purchase orders for vendor on commission basis and was not engaged in any of the above activities, the Larger Bench concluded that the services provided by the said appellant would not fall within the definition of 'clearing and forwarding agent' as contained in the Act. The detailed discussion on this aspect runs as follows : "9.3 An agent engaged only for procuring purchase orders for the vendor on commission basis does not engage in any of the above activities, dire....
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.... goods. Clearing and forwarding has a very specific connotation in the context of movement of goods from the supplier to their destination and agents undertaking clearing and forwarding operations may never have been concerned with procurement of orders for the goods which are cleared and forwarded. A person entrusted with the work of commission agent for procuring orders for the principal cannot insist on also providing services as clearing and forwarding agent in respect of those goods and it would be open for the principal to engage some other person for the purpose of forwarding such goods. In cases where the buyer is under an obligation to take delivery of the goods from the vendor's premises, there would not be even any need on the part of the vendor to engage any forwarding agent, nor can a person engaged for the purpose of clearing and forwarding operations, insist on procuring orders for the principal in the absence of any stipulation to that effect. 11. We, therefore, hold that mere procuring or booking orders for the principal by an agent on payment of commission basis would not amount to providing services as "clearing and forwarding agent", within the meaning of th....
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.... proper destination. Such an agent normally owns the transport necessary for this work and often arranges FREIGHT and Customs formalities for his principal." In Fourth Edition of Halsbury's Laws of England (Volume 5), the characteristics of 'forwarding agents' are narrated in the following manner : "442. Characteristics of forwarding agents. - A forwarding agent is one who carries on the business of arranging for the carriage of gods for other people. It must be clearly understood that a forwarding agent is not, in general, a carrier: he does not obtain possession of the goods: and he does not undertake the delivery of them at the other end. All that he does is to act as agent for the owner of the goods to make arrangements with the people who do carry, such as shipowners, road hauliers, railway authorities and air carriers, and to make arrangements, so far as they are necessary, for the intermediate steps between the ship and the rail, the Customs or anything else. Although there is a clear distinction between a forwarding agent and a carrier, the same person may carry on both activities at once, and contract sometimes as one and sometimes as the other. The fact that a perso....
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....ng him as to the proper transport and insurance arrangements which should be made for valuable goods. A forwarding agent is not normally personally liable to pay the charges of carriers whom he engages to carry the gods on behalf of his principal; but there is a Custom of the London freight market that forwarding agents incur personal liability to shipowners for the payment of freight or of dead freight for booked space left unfilled. A forwarding agent who tenders dangerous goods to carriers without warning them of their nature or of the precautions which should be taken in their carriage is personally liable to the carriers for any resulting damage through breach of the implied warranty that the goods are fit for carriage." 11. From the reading of the definition contained in the aforesaid provision, together with its dictionary meanings contained in Legal and Commercial dictionaries, it becomes apparent that in order to qualify as a C&F Agent, such a person is to be found to be engaged in providing any service connected with 'clearing and forwarding operations'. Of course, once it is found that such a person is providing the services which are connected with the clearing an....