TaxTMI 
TaxTMI 
2024 (5) TMI 465
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....t from Platform to Trucks and local transport from railway siding to godown); (ii) S&D (Unloading of Cement at godown and Loading of Cement from godown to truck for delivery); and (iii) Remuneration and Commission (Commission @Rs.8/- per M.T.) and Godown Service Charges at fixed amount towards expenses incurred for telephone, furniture, account personnel, etc., on behalf of the principal, being reimbursed on a monthly basis) 3. However, it was noticed by the Revenue that the appellant had neither taken Service Tax registration nor discharged Service Tax liability on the charges received from M/s. L&T. 4. A Show Cause Notice dated 28.09.2004 was issued to the appellant demanding Service Tax of Rs.4,91,324/- for the period from September 1999 to March 2001 and September 2003 to March 2004. 5. The Notice was adjudicated by the Ld. Assistant Commissioner vide Order-in-Original dated 31.03.2011 wherein he confirmed the Service Tax demand of Rs.4,91,324/- along with interest and appropriated an amount of Rs.1,17,862/- deposited by the appellant before adjudication of the case. He also imposed a penalty of Rs.3,73,462/- under Section 78 of the Finance Act, 1994 and Rs.5,000/-under ....
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....vices by the appellant. He submits that the activity of lifting, receiving, loading and unloading of goods as per the directives of the principal are covered within the ambit of C&F agent service. He contends that the remuneration or commission, by whatever name it is called, paid in connection with the clearing and forwarding operations, is includable in the gross value for the purpose of charging Service Tax. Accordingly, he supports the impugned order confirming the demands. 10. Heard both sides and perused the appeal documents. 11. We observe that the issue involved in the present appeal is the valuation for the purpose of demanding Service Tax on the C&F agent service. In the present case, we observe that the appellant has rendered the following chain of activities on behalf of their principal: - (i) C&F: Unloading of cement from wagon to platform. Loading of cement from platform to trucks. Local transportation from railway siding to godown. (ii) S&D: Unloading of cement at godown. Loading of cement from godown to the trucks for delivery. 11.1. From the above, it is clear that the appellant has been rendering the service of lifting, receiving, loading and unloading of g....
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....rsable expenses received in connection with rendering of service in respect of C&F agent services are includable in the assessable value. The relevant part of the said decision reads as under: - "6.1 Having analyzed the various decisions cited on behalf of the assessee and on behalf of the department, it would be appropriate to consider the scope of the term 'reimbursements" in the context of money realized by a service provider. A person selling the goods to another cannot treat cost of raw materials or the cost of labour or other cost components for inputs services, which went into the manufacture of the said goods as reimbursements. If the buyer enters into a contract for supply of raw materials after negotiating prices from the supplier for the raw materials and the raw materials are received by the manufacturer and the manufacturer pays the amounts to the supplier of raw materials and recovers the same from the buyer, it can certainly be considered as reimbursements. It is to be noted that in such a case, the manufacturer has no role about choosing the source of the materials procured or the price at which the materials procured and the manufacturer is not under any lega....
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.... 12.4. By relying on the decision cited above, we hold that these reimbursable expenses collected by the appellant are includable in the gross value for the purpose of charging service tax under the category of C&F agent service. 13. In their submission, the appellant has stated that they had no intention to evade the payment of Service Tax. The Show Cause Notice was issued for the period from September 1999 to March 2004 on 28.09.2004 by invoking the extended period of limitation. It is their submission that Service Tax under the category of C&F agent was a new levy and they were not aware of the liability to Service Tax; that immediately after the liability was brought to their notice, they took registration and paid Service Tax of Rs.1,17,862/- and also filed their returns for the period from September 1999 to March 2004.It is submitted by the appellant that the returns thus filed were duly acknowledged by the jurisdictional Range Superintendent on 25.10.2004 and no objection was raised regarding the payment of Service Tax on reimbursable expenses at the time of filing the returns. Accordingly, the appellant contended that the extended period of limitation is not invokable in ....