TaxTMI 
TaxTMI 
2025 (10) TMI 455
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....in relation to the CHA services being provided, it was alleged that the Appellant had in addition to the charges for the CHA service, also collected (i) Form & Stamp Charges; (ii) Xerox; (iii) Custom examination charges; (iv) expenses towards local conveyance of staff, etc., and the said four charges were excluded by the Appellant whilst computing the assessable value for the purposes of service tax. c. It was further noticed that the appellant owns a crane and two forklifts, which were used to shift big machineries/materials from one place to another as well as from one point to another within the same premises. On the basis of information provided by the Appellant's customers, it was ascertained that the Appellants sent their crew with necessary tools, and if the crane and forklifts were sent, they were sent along with a driver. In certain cases it appeared that the Appellants were only sending workers for shifting of material without any forklift or crane. For provision of such services the Appellant had been collecting certain charges. d. In view of the above, the appellant was issued with a Show Cause Notice dated 30.03.2009 proposing to demand differential d....
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....ent appeals before this forum. 3. We have heard the Ld. Counsel Ms. Radhika Chandrasekar for the Appellant as well as the Ld. Authorized Representative Ms. O.M. Reena, for the Department. 4. In the present case there are two issues, wherein the demands of service tax have come to be confirmed against the Appellant herein. The Commissioner (Appeals-I) vide the impugned order has framed the issues as under: - "6. I have carefully gone through the records of the case and various submissions of the Appellant and the case laws cited. The issues to be decided here are: - a. Whether or not the expenses viz., relating to Forms, Stamps, Xerox, and Customs Examination Charges incurred by the Appellant on behalf of their client fall within the scope of 'Pure Agent'; b. Whether or not the amount received on the services rendered by the Appellant in letting of Cranes and Forklifts fall under the category of 'Business Auxiliary Service' and liable to service tax; c. Whether or not the penalties imposed are sustainable" 5. With regard to the first issue, it is pertinent to note that the Commissioner (Appeals-I) has stated that in relati....
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....to extract something more from him by including in the valuation of the taxable service the other expenditure and costs which are incurred by the service provider "in the course of providing taxable service". What is brought to charge under the relevant Sections is only the consideration for the taxable service. By including the expenditure and costs, Rule 5(1) goes far beyond the charging provisions and cannot be upheld. It is no answer to say that under sub-section (4) of Section 94 of the Act, every rule framed by the Central Government shall be laid before each House of Parliament and that the House has the power to modify the rule. As pointed out by the Supreme Court in Hukam Chand v. Union of India, AIR 1972 SC 2427 :- "The fact that the rules framed under the Act have to be laid before each House of Parliament would not confer validity on a rule if it is made not in conformity with Section 40 of the Act." Thus Section 94(4) does not add any greater force to the Rules than what they ordinarily have as species of subordinate legislation. 6. This decision of the Delhi High Court has come to be affirmed by the Hon'ble Supreme Court of India in the case o....
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....es the goods or services so procured by the service provider in his capacity as pure agent of the recipient of service; • the recipient of service is liable to make payment to the third party; • the recipient of service authorises the service provider to make payment on his behalf; • the recipient of service knows that the goods and services for which payment has been made by the service provider shall be provided by the third party; • the payment made by the service provider on behalf of the recipient of service has been separately indicated in the invoice issued by the service provider to the recipient of service; • the service provider recovers from the recipient of service only such amount as has been paid by him to the third party; and • the goods or services procured by the service provider from the third party as a pure agent of the recipient of service are in addition to the services he provides on his own account. Explanation 1: For the purposes of sub-rule (2), "pure agent" means a person who- • enters into a contractual agreement with the recipient of service to act as his....
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....r the category of "supply of tangible goods" service as per Section 65(105)(zzzzj) of the Finance Act, 1994, which came into the Service Tax net only with effect from 16.05.2008. We observe that the demand raised in this regard against the appellant pertains to the period prior to this date, 6.2. We find that a similar issue has been dealt with by this Tribunal in the appellant's own case vide Final Order No. 76552 of 2018 dated 05.07.2018 in Service Tax Appeal No. 148 of 2009 (CESTAT, Kolkata)wherein this Tribunal has already held that the service rendered by the appellant is not liable to be taxed under the category of "business support services" for the period under dispute. For the sake of ready reference, the relevant part of the said decision is reproduced below: - "6. Our views are also fortified by the decision of Hon'ble Bombay High Court in the case of Indian National Shipowners' Association(supra), the relevant extract of which is reproduced as under:- "38. If the Department's contention is accepted that would mean that the activities of the members of the 1st petitioner are covered by entry(zzzy) and entry (zzzzj). Such a resul....