AI Drafter 
TaxTMI 
TaxTMI 
2024 (8) TMI 1104
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....Commr/ST-II/KOL/2018-19 dated 30.11.2018 wherein the Ld. Commissioner has confirmed the entire demand of service tax as proposed in the Show Cause Notice along with interest and penalty. Aggrieved against the impugned order, the appellant has filed this appeal. 2. The appellant submits that the demand of service tax confined in the impugned order relates to the following categories as tabulated below: - Sl. No. Head of Service Amount (Rs.) 1. Commission/brokerage received from Shipping Lines- Para 4.4 of OIO Rs. 10,11,406/- 2. Cargo handling services- Para 4.5 of OIO Rs. 46,39,520/- 3. Difference on ocean freight collected and paid to shipping lines- Para 4.6 of OIO Rs 1,37,13,491/- 4. Director Sitting fees- Para 4.7 of OIO Rs. 2,96,020/- 5. GTA services - Para 4.8 of OIO Rs. 1,05,68,818/- Total Rs. 3,02,29,255/- 2.1. As regards the demand of Service Tax of Rs.10,11,406/- (including cess) on commission/brokerage received from Shipping Lines, the Appellant submits that there is no service provided by them to the shipping lines and the commission earned is on account of booking of cargo with the shipping line....
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.....L. 337 (Tri. - Del.)] e. Bhatia Shipping Private Limited vs Commissioner of Service Tax, Mumbai [2022-TIOL-116-CESTAT-MUM] f. Direct Logistics India Pvt. Ltd. Versus Commr. Of ST., Bangalore S.T.-I [2021 (55) G.S.T.L. 344 (Tri. - Bang.)] Accordingly, the appellant submits that the demand confirmed in the impugned order on this count is not sustainable. 2.3. As regards demand of Service Tax of Rs. 46,39,520/- (including cess) in relation to cargo handling services, the Appellant submits that the demand of service tax has been erroneously confirmed by the Ld. Adjudicating authority without appreciating the nature of expenses, which are reimbursable expenses during the course of provision of CHA services. The Appellant states that such expenses related to AD Code Registration charges, Custom Clearance charges, Port charges, EDI Registration charges, AWB fee etc. which were nothing but reimbursement of actual expenses and hence they cannot form part of consideration for levy of service tax. In this regard, the Appellant relies on the decision of CESTAT New Delhi in the case of Commissioner of Service Tax, New Delhi v. Karam Freight Movers [2017 (4) G.S.T.L. 215....
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....thorized Representative appearing for the Revenue reiterated the findings in the impugned order. 4. Heard both sides and perused the appeal documents. 5. We observe that the ld. adjudicating authority has confirmed the demand under various categories. The Appellant has accepted the demand of service tax of Rs.2,96,020/- confirmed in the impugned order on the 'Director Sitting Fees' and contested the remaining demands. Regarding the demand of Rs.2,96,020/- confirmed on the Director Sitting Fees, we observe that the Appellant has already paid this amount, but not paid the interest. Accordingly, we uphold the demand of service tax along with interest confirmed in the impugned order on this count. As there is no suppression of fact with intention to evade the tax established in this case, we hold that no penalty is imposable on the Appellant on this demand confirmed and upheld. 5.1. Regarding the demand of Service Tax of Rs. 10,11,406/- (including cess) confirmed in the impugned order on the commission/brokerage received by the appellant from Shipping Lines, we observe that there is no taxable service rendered by the appellant to the shipping lines and the commission earned is....
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...., either prior to its amendment on 1 May, 2006 or after this amendment. 77. Consideration, which is taxable under section 67 of the Finance Act, should be transaction specific. Incentives, on the other hand, are based on general performance of the service provider and are not to related to any particular transaction of service. It needs to be noted that commission, on the other hand, is dependent on each booking and not on the target. If the air travel agent does not achieve the pre-determined target, incentives will not be paid to the travel agents." By relying on the decision of the Larger Bench cited above, we hold that the demand confirmed in the impugned order on this count is not sustainable and accordingly, we set aside the same. 5.2. Regarding the demand of Service Tax of Rs. 1,37,14,491/- (including cess) confirmed in the impugned order, we observe that this demand has been confirmed on the profit earned by the Appellant on the ocean freight collected and paid during the period from January 2013 to March 2016. We observe that in the impugned order, the ld. adjudicating authority has held that the profit earned by the Appellant are in the nature of Informatio....
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.... Support Service, any activity which is rendered on behalf of another person ie, when the relationship is in the nature of principal-to-agent, then only such activity is liable to service tax under the category of Business Support Service. In the instant case, the Appellant were buying the space for transportation of containerized goods outside the territorial water of the country and selling the same to their clients in their own capacity and is not obligated to work on principal-to-agent relationship. Accordingly, we hold that the income received by the Appellant is not liable to service tax under the category of 'Business Support Service' as confirmed in the impugned order. 18. We observe that the issue stands settled by several decisions of this Tribunals cited by the Appellant. In the case of Direct Logistics India Pvt. Ltd. Vs. Commissioner of S.T. 2021(55)GSTL 344(T) this Tribunal observed has held as under : "............................................................. 14. It is undisputed that the appellant is registered with service tax department for "Clearing and Forwarding Agent Service" and has been paying service tax on the service....
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.... chargeable on the difference between the ocean freight collected from the clients and the ocean freight paid to the shipping lines. ............................................................" 19. In view of the above discussions and by following the decisions of the Tribunals cited by the Appellant refereed above, we hold that the demands confirmed in the impugned order on this count is not sustainable and accordingly, we set aside the same." By relying on the decision of the Tribunal cited above, we hold that the demand confirmed in the impugned order on this count is not sustainable and accordingly, we set aside the same. 5.3. Regarding the demand of Service Tax of Rs.46,39,520/- (including cess) in relation to cargo handling services, we observe that the demand of service tax has been confirmed by the ld. adjudicating authority on the amounts received by the appellant as 'reimbursable expenses' during the course of provision of CHA services. We find that the such expenses received by the appellant are related to AD Code Registration charges, Custom Clearance charges, Port charges, EDI Registration charges, AWB fee etc. which were nothing but &#....
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....harges from the customers for providing the said transport services. The Appellant submitted copies of invoices raised by the truck owners. On verification, we find that these invoices were raised for 'Hire charges' and not for transportation of goods, except one invoice raised by M/s. Rishab Trans Management dated 05.01.2017. Copy of the same is extracted below : - From the invoice extracted above, we observe that the invoice has been raised on the Appellant for transportation of the goods and it has been categorically mentioned in the said invoice that the Service Tax is to be paid by the Party. Accordingly, in respect of this invoice, the liability of payment of Service Tax on the freight amount of Rs.4,20,000/- is on the Appellant. Therefore, we hold that the Appellant is liable to pay Service Tax on this invoice on the freight amount of Rs.4,20,000/- under the category of GTA Service, along with interest. 5.5. In respect of the remaining demand confirmed under the category of GTA Service, we observe that the services provided by the various local truck owners are not related to goods transportation service as there was no 'consignment note' issued by such persons to the ....