TaxTMI 
TaxTMI 
2025 (8) TMI 169
X X X X Extracts X X X X
X X X X Extracts X X X X
.... The appellant is holding Service Tax Registration No. AAHFA3182AST001 and engaged in providing 'Clearing and Forwarding Agent Services'. 2.2 During the audit of the records of the appellant for the period 2012-13 to 2016-17, it was observed that apart from providing C & F Agent Service, the appellant also arranged the service of transportation to the principal companies and received consideration for the same. They did not discharged service tax on this amount. The expenses incurred by the appellant for providing these services was less than the consideration received. Resulting in short payment of service tax as indicated in the table (table as per the appeal memo) below:- F.Y. Period of F.Y Reimbursement of Freight From the Principal Actual Freight Paid Expense for their own truck Difference Rate of Service Tax Service Tax payable 2012-13 Oct. 2012 to March 2013 27933927 18674189 3007016 6252722 12.36% 772836 2013-14 April 2013 to March 2014 57001806 35588478 3439352 17973976 12.36% 2221583 2014-15 April 2014 to March 2015 62128055 36961479 3530042 2163....
X X X X Extracts X X X X
X X X X Extracts X X X X
....o Only) (Service Tax Rs.1,25,49,788/-, Education Cess Rs.1,21,613/, S&H Education Cess Rs.60,807/-, Swachha Bharat Cess Rs.1,83,092/- and Krashi Kalyan Cess Rs.1,16,622/-) for the period 2012-13 (01.10.2012 onwards) to 2016-17 under Section 73 of the Finance Act. 1994 against M/s. Awasthi Brothers, Khandelwal Complex, Lasudia Mori, Dewas Naka, Indore -452001(Μ.Ρ.). (ii) I order for recovery of interest at the applicable rates on the amount of Service Tax (including Cess) confirmed in (i) above under Section 75 of the Finance Act, 1994. (iii) I do not impose penalty under Section 76 of Finance Act, 1994 upon the Noticee. (iv) I impose a penalty of Rs. 10,000/- (Rs. Ten Thousand only) under Section 77 of the Finance Act, 1994 upon the Noticee for failure to furnish the correct Returns. (v) 1 impose penalty of Rs. 65,15,960/- (Rs. Sixty Five Lakh Fifteen Thousand Nine Hundred Sixty Only) under the provisions of Section 78 of the Finance Act, 1994. However, if such service tax and the interest payable thereon is paid Within thirty days from the date of communication of this order, the amount of penalty liable to be paid by the assessee shall b....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... payment of transportation charges by the C & F Agent on behalf of the Principal which are reimbursed by the Principal later on to the C & F Agent. 10.2 In this case, the contention of the department is that there is a single contract for C & F agent service in which the C & F agent has been asked to arrange for the transportation of goods. As such the amount of transportation charges recovered by the Appellant will form part of remuneration of C & F Agent service. However, the show cause notice as well as the adjudicating authority is silent as to how rates for both services are decided in the said agreement. It has not been mentioned in the show cause notice as well as the impugned adjudication order that the rates are agreed upon in lump sum for both activities together. Whereas, it is admitted fact that the charges for transportation of goods are recovered by the Appellant No.1 by issuing separate invoices. So I find that it is not case of composite contract for provision of both the services wherein the charges are paid in lump sum for both services. 10.3 Here I also find that present case doesn't fall in the category of reimbursement of transpor....
X X X X Extracts X X X X
X X X X Extracts X X X X
....signment notes, when there is no mention of issuance of consignment notes by the transporters in the show cause notice itself. So, these observations of the adjudicating authority are not sustainable. 12.2 Here I find that in cases where there is a contract specifying separate rates for providing two distinct services and bills are raised separately, then their assessment has to be done separately under two distinct service category because these two services cannot be considered as composite service for clubbing their taxable value for assessment purpose. Further, I also find that in present case, since the contract rates for providing transportation service are separately decided which are other than the charges agreed upon for C & F agent service and also charged separately, this transaction between the Appellant No.1 and their service receiver client is on Principal to Principal basis. So the Appellant No.1, while providing the transportation service, does not satisfy the condition of working as Agent of their Principal to fall under the service category of C& F Agent services. Therefore, I find that transportation service will not be covered as part of the se....