TaxTMI 
TaxTMI 
2023 (6) TMI 647
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.... amount can be said to be services in relation to "procurement of customer and verification thereof" as stated in Section 65(19) (iv) of the Finance Act, 1994? Even where such clause has come into force from 10-09-2004 and when no such clause was ever specified in the SCN? (iii) Can CENVAT credit in respect of input services such as Air conditioner repairs, motor car repair, travelling expenses etc. used in relation to business activities of this appellant?' (iv) Can extended period of limitation be invoked and savage penalties be imposed on this appellant when there is not an iota of evidence of suppression or intent to evade payment of service tax and all transactions are duly reflected in books of accounts and when question of interpretation is involved and when hundreds of cases on these issues has travelled to Tribunals and courts and CBIC has to issue more than one clarifications on these issues? 02. Shri Nilesh V. Suchak, Learned Chartered Accountant appearing on behalf of the appellant submits that as regard the reimbursable expenses under CHA service, the appellant is a custom house agent and had paid duly service tax on Agency Charge which is taxa....
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....s Auxiliary Service on incentive/commission received from shipping line or streamer agent for achieving business target during the period from 01.04.2003 to 31.03.2008 he submits that there was no proposal under SCN to demand service tax under Section 65(19)(iv) of the Finance Act, 1994 and hence the impugned order has travelled beyond the scope of show cause notice. This clause was not in statute till 09.09.2004 and hence confirmed the demand also for the period 01.04.2003 to 09.09.2004 is illegal. Further the appellants were getting incentive/commission from shipping line which has not provided any procurement of customer and verification service. The dealing of the appellant with shipping line or streamer agent is on principal to principal basis and when the incentive is received for achieving certain targets and the same is not consideration for any goods or service and thus is not taxable under Business Auxiliary Service. 2.4 Without prejudice he also submits that even if the same is presumed to be taxable, the service of Commission Agent was exempted under notification no. 31/2003-ST dated 20.06.2003 from 01.07.2003 to 08.07.2004. As regard the demand of cenvat credit i....
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....d by Custom House Agents and Steamer Agents regarding. By the issue of Notification No. 17/96-Service Tax dt. 6.6.97, service tax has been imposed on Custom House Agents and Steamer Agents w.e.f. 15.6.97. The service Tax is imposed under the provisions of Chapter V of the Finance Act, 1994 (32 of 1994), as amended. 2. CUSTOM HOUSE AGENTS In the context of these two services, certain points have been raised for clarification which are discussed below: 2.1 The expression "Custom House Agent" has been defined to mean a person licensed, temporarily or otherwise, under the regulations made under sub-section (2) of Section 146 of the Custom Act, 1962. A person is permitted to operate as a Custom House Agent, temporarily under regulation 8(1) and permanently Regulations, 1984. 2.2 As per the Finance Act, 1997, the taxable service rendered by a Custom House Agent means any service provided to a client by a Custom House Agent in relation to the entry or departure of conveyances or the import or export of goods. The value of the taxable service in relation to the service provided by a Custom House Agent to a client has agent from the client for se....
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.... be included for computing the service tax. 2.5 In many cases, the Customs House Agent undertakes "turnkey" imports and exports where a lump sum amount is charged from the client for undertaking various services. In these cases, the lump sum amount covers not only the "agency commission" fee but also other expenses and no separate break-up is given in respect of these expenses. It has been decided that in such cases, the value of the taxable service shall be 15% of the lumpsum amount charged to the client. The Custom House Agents are required to show the service charges as 15% of such lumpsum amount of the bills and Service Tax of 5% will be chargeable on the above 15%. 2.6 Some times, CHAs sub-contract their work to CHAs located in other stations. In such cases, it is possible that the sub-contracting CHA raises the bill on the main CHA who in turn raises the bill to the client. It has been decided that in such cases, the sub-contracting CHA will not be required to pay service tax on the bills raised by him on the main CHA, The service tax will be payable by the CHA who provides the actual service to the client and raises the bill to the client. 2.7 A CH....