TaxTMI 
TaxTMI 
2020 (9) TMI 838
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....der Notification No. 18/2009-ST dated 07.07.2009. Therefore, the enquiry has been initiated against the appellant on the ground that they have neither obtained service tax registration nor paid the service tax on the services received by them from their foreign commission agent to whom commission of 11%-12.5% was passed on. During the enquiry, the enquiry officers have collected copies of shipping bills, bank realization certificates, balance sheets, copies of contract/ agreement made with their foreign commission agent, for the period of 2007-08 to 2011-12. The case of the department is that, 11% commission shown in the invoice which was deducted from the invoice value is nothing but commission paid to the commission agent towards export of goods therefore, the said 11%-12.5% commission is chargeable to service tax under the head 'Business Auxiliary Service'- Foreign Commission Agent in terms of Section 65(19) of the Finance Act, 1994 and is taxable service vide Section 65(105) (zzb) of Finance Act, 1994 read with section 66A of the said Act under reverse charge mechanism. Accordingly, show cause notices were issued and the Adjudicating Authority confirmed the demand along with pe....
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....iance on the following judgments:- (a) CC (Prev.) Amritsar vs. Malwa Industries Limited 2009 (235) ELT 214 (SC) (b) Sambhaji vs. Gangabai - 2009 (240) ELT 161 (SC) (c) CC (Prev.) Mumbai vs. M. Ambalal & Company - 2010 (260) ELT 487 (SC) (d) Share Medical Care vs. UOI - 2007 (209) ELT 321 (SC) 4. Learned Counsel further submits that since commission is related to export of goods and same is in any case not taxable or even if taxable, the same is refundable therefore, the entire exercise is Revenue neutral. Since there is clearly a Revenue neutrality in the present case, the demand raised invoking extended period will not survive as there is no malafide intention to evade payment of service tax. In his support he placed reliance on the judgment in the case of J.P.P. Mills Pvt. Limited vs. CCE, Salem - 2016 (46) STR 317 (Tri. Chennai) and Texyard International vs. CCE, Trichy - 2015 (40) STR 322 (Tri. Chennai). 5. Shri H.K. Jain, learned Assistant Commissioner (Authorised Representative) appearing on behalf of the Revenue reiterates the findings of the impugned order. He submits that in the invoice, the appellant have clearly mentioned 11% com....
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....ods, in case of service of commission agent, if involved, there has to be third person as service provider to facilitate and promote the sale of exporter to a different foreign buyer. In the present case, there is absolutely no evidence that this 11% is paid to some third person as commission. There is no contract of commission agent service with any of the commission agent, there is no person to whom payment of commission was made therefore, it is clear that no service provider i.e. foreign commission agent exists in the present case and no service was provided by any person to the appellant. In the absence of any provision of service, no service tax can be demanded. The trade discount even though in the name of commission agent was given by the appellant to the foreign buyer, by any stretch of imagination cannot be considered as commission paid towards commission agent service, hence cannot be taxable. This issue has been considered time and again by this Tribunal. In the case of Duflon Industries Pvt. Limited vs. CCE, Raigad (supra) and the Tribunal held as under : "6. The entire issue revolves around the fact whether clearances effected by appellant on goods which expo....
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....mpugned orders demanding service tax under reverse charge mechanism from appellant are unsustainable and liable to be set aside." In the matter of Hindustan Petroleum Corporation Limited - 2019 (24) GSTL 569 (Tri. Del.), identical issue was decided wherein the HPCL, under an agreement for sale to retail customer purchased CNG from Indraprasth Gas Limited, the HPCL received consideration. The Tribunal held that the said consideration is in the nature of discount as agreement between HPCL and IGL is not on principal to agent basis but on principal to principal basis therefore, HPCL is not liable to service tax under the head of Business Auxiliary Service. In the case of Prabhakar Marotrao Thaokar & Sons vs. CCE, Nagpur - 2019 (20) GSTL 294 (Tri. Mumbai), the department raised demand on discount given by manufacturer to the appellant who is a wholesale dealer while supplying goods for further distribution. The department alleged that such discount is basically sales commission and liable to service tax under the category of Business Auxiliary Service under Section 65 (105) of Finance Act, 1994. The coordinate bench at Mumbai held that the transaction between appellant and wholesale....
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.... on 22.09.2020) ============= Document 1 CORT 156 180 Mo 3/157 Indian Custans EDI Rystem (ICEE) 130 Date: 22/03/2013 JNCR, HAVA SHEVA, TAL:UAN, DIST-RAIGAD-400707 Shipping Bill for Expork No: 9481723/17/03/2011 BRC Realisation Date: A: AAAFR2472DCHO01 RAJKUMAR PREIGHT FORWARDERS rint Date: 28/04/2011 14:33 mis consignment was not opened for physical examination by Customs Nort of Idg-Code: INDSA State of Origin :GUJARAT PORTER DETAILS 5205014059 , PAN NO. JAIME EXPORTS 1 Branch #0 CONSIGNER APMP0156002 M/S. ALDEYAA SPARE PARTE 142. 1ST FLOOR, ASHIRWAD IND.CODEERA FISH R/A AL QAIZI SOCIETY LTD.. BESTAN RAT/GUJARAT 395023 . Port of Loading :T, Nhava Sheva Port of Discharge: Jebel Ali Gross Wes) :4854.500 BUILDING OFFICE # 304, DUBAI, U.A.E. PH: 2711725 UNITED ARAS ENTRATES Total Pkgs : 35 Loose pekta: 0 Nat W(as) :4179.500 Country of Dest UNITED ARAB EMIRATES No. of Ctrs. : 1 Lotation No. :29338 Mature of Cargo: C Marks and Nos.: Rotation Date ASEAD CON NOS. 7510 TO 7604 FOREX BANK ACC:25950400000033 13: Kaiver No/Date: PO....
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....duty free licence under the duty exemption scheme in respect of Export made agaainst this shipping bir, Tha pods are covered by Sr.blo 43(A) of DEPB rate list under the product code the presp nt marketvalue of the goodsbeing exported under this shipping bill and benefit under DEPB SCHEME against this exports We shall also avail benefits under Chapter-3 of FTP, if applicable. Amount Chargeable: (In Words) Declaration: Commission:11% 5329.50 43,120.50 TOTAL:- US Dollars: Forty Three Thousand One Hundred Twenty and Cents Fifty Only 43,120.50 (Goods are of Indian Origin) We declare that this Invoice shows the actual price of the goods. Described and that all the particulare are true and correct. Document 3 APPENDIX 22 A BANK CERTIFICATE OF EXPORT AND REALISATION FORM NO.1 160 ORIGINAL (To, The Joint Director General of Foreign Trade, 6TH Floor, Resham Bhavan, Lal Drawain SURAT.I/We M/s. Laxmi Export 142 1ST Floor, Ashirwad Ind. Co-Op Sec. Ltd Bhesian, Surat-395 023 (Name and Address of the Exporteral hereby declare that we have forwarded a documentry Export bill to Bank of Baroda, International Bus....