TaxTMI 
TaxTMI 
2023 (5) TMI 605
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.... of commission. The "Business Auxiliary Service" was brought into service tax net w.e.f. 01.07.2003 under Section 65 (19) of the Finance Act, 1994. 3. The revenue took a view of the activity undertaken by the appellant against under the category of "Business Auxiliary Service". Therefore, a show-cause notice dated 26.09.2008 was issued to the appellant to demand of service tax on commission received by them during the period 2003-04 and 2004-05 under "Business Auxiliary Service" under Section 65 (19) of the Finance Act, 1994. 4. The show-cause notice was contested by the appellant by way of reply justifying that prior to 01.07.2003, the "Business Auxiliary Services" were not in the statutory book, therefore, no service tax is payable by them for the period prior to 01.07.2003. It is also contended that from 01.07.2003 to till 08.07.2004, they were not liable to pay service tax on commission agent services in view of Notification No.13/2003-ST dated 20.06.2003. For any service rendered post 08.07.2004, it was contended by them the same is barred by limitation. The adjudicating authority, after taking note of defence taken by the appellant passed the impugned order confirming d....
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....Issue No (a) 10. We find that in this case, "Business Auxiliary Service" has been introduced w.e.f. 01.07.2003 through Section 65 (19) of the Finance Act, 1994, which is as under : "2.4 As per definition of "Business Auxiliary Service" as defined under Section 65 (19) of the Finance Act, 1994, means any service in relation to ,- (i) Promotion or marketing or sale of goods produced or provided by or belonging to the client ; or (ii) Promotion or marketing of services provided by the client ; or (iii) Any customer care service provided on behalf of the client ; or (iv) Any incidental or auxiliary support service such billing, collection or recovery of cheques, accounts and remittance, evaluation of prospective customer and public relation services and includes services as a commission agent but does not include any information technology service ; And as amended by the Finance (No.2) Act, 2004, w.e.f. 10.09.2004, the following services are also included in the "Business Auxiliary Service" ; (v) procurement of goods or services which are inputs for the client ; or (vi) production of goods on b....
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....n the Territory as instructed by KAM. (c) To raise the invoices on behalf of KAM for all sales effected. (d) To collect payment from customers on due dates of invoices. (e) To obtain Delhi Excise Licence on behalf of KAM as may be required and to renew the same from time to time for operating a depot in the Territory for stocking, trading and distribution of its products. (f) To register KAM under the local Sales Tax Act (LST) and also under the Central Sales Tax Act (CST). (g) To ensure compliance by KAM with various regulations of Local and Central Sales Tax Acts and Rules, COMMISSION AGENT agrees to maintain statutory records at the depot and also to attend to various functions/matters as mentioned in Annexure 'A'. (h) To adhere to the general procedure of operation as described by KAM in Annexure 'B'. (i) To maintain statutory and proper books of account and records, and to submit appropriate reports/returns as required under any local laws or regulations in force and which KAM is required to comply with. Besides, COMMISSION AGENT shall on a periodic basis submit reports and reconciliation. COMMISSION AGENT....
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....d by a commission agent from the service tax leviable thereon under sub-section (2) of section 66 of the said Act. Explanation. - For the purposes of this notification, "commission agent" means a person who causes sale or purchase of goods, on behalf of another person for a consideration which is based on the quantum of such sale or purchase. 2. This notification shall come into force on the 1st day of July, 2003. [Notification No. 13/2003-S.T., dated 20-6-2003] It is evident from the Explanation contained in the said Notification that the Commission Agent means a person who causes sale or purchase of goods, on behalf of another person for a consideration which is based on the quantum of such sale or purchase. It is evident from the provisions of the agreement quoted above that the appellant was causing sale or purchase of goods on behalf of its clients (liquor company). It is also evident that the consideration received by the appellant was based on the quantum of the goods sold. Therefore it satisfied the requirements of being categorised as commission agent as per the definition given in the said Notification. Though, admittedly, the ....
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....able because (i) The definition of commission agent in Notification No. 13/2003-ST nowhere stipulates that a commission agent should primarily cause sale. (ii) There is nothing in the said Notification to imply that a commission agent to be eligible for the benefit of the said notification should not render business auxiliary services which are beyond the scope of function of commission agent. (iii) The adjudicating authority has in effect conceded that the appellant has provided certain business auxiliary services which are clearly within the ambit of the role of a commission agent. The notification exempts business auxiliary services provided by a commission agent (and not merely those business auxiliary services which are provided as a commission agent)." We find that in case of Brindco Sales Ltd. (supra), the issue was examined by this Tribunal as observed as under : "It is evident from the Explanation contained in the said Notification that the Commission Agent means a person who causes sale or purchase of goods, on behalf of another person for a consideration which is based on the quantum of such sale or purchase. It is evident ....