2008 (5) TMI 272

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.... Thereafter a show cause notice was issued to them which culminated in confirmation of the demand and adjustment of the duty already paid and also imposition of penalties under Sections 76, 77 & 78 of the Finance Act, 1994. The appellants had requested for only lenient treatment at the time of adjudication by the Original Authority but subsequently before the Commissioner (Appeals) they took a stand that the services rendered by them were exempt under Notification No. 13/2003-S.T., dated 20-6-2003 which exempted commission agent from payment of service tax during the period from 1-7-2003 to 8-7-2004. They also sought wavier of penalty under various sections under the Circular No. 137/39/2004-CX.4 dated 23-9-2004. The same grounds have been ....

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....ed that services provided by them falls under the category "business auxiliary services". Business auxiliary services are brought under service tax net by Finance Act, 2003 with effect from 1-7-2003. The definition of business auxiliary service has been given in Section 65(19) of the Finance Act, 1994 and during the relevant time, the definition reads as under:- "business auxiliary service" 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 service 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 as billing, collec....

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....tion itself and the commission agent who causes sale or purchase of "goods" were exempt from payment of service tax. The definition of commission agent has been given in the said notification as person who causes sale or purchase of "goods" and not "services" and hence person engaged in sale or purchased of services on behalf of their clients were not covered under the definition of "commission agent" for the purpose of availing exemption under Notification No. 13/2003-S.T. dated 20-6-2003. In the present case the appellant had provided services of networking, marketing, sales and distribution of services of M/s. Tata Teleservices Ltd. and had earned commission. The services provided by the appellants were covered under business auxiliary s....