TaxTMI 
TaxTMI 
2025 (12) TMI 1074
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....e penalty imposed under section 77 of the Finance Act 1994, has otherwise upheld the Order in Original No.107/2012 dated 30.03.2012. 2. Brief facts are that, during an audit conducted by the officers of AG (Audit), CERA, the balance sheet, ST3 returns and other related documents of the Appellant, pertaining to the period from 2008-09 was verified. It was noticed that the appellant had received a commission of Rs. 96,06,293/- from K.W. (Kerpenwerk), Germany ( K.W. in short) towards procuring orders in India for the products of K.W. The department was of the opinion that the said activity of the appellant of procuring orders in India for the overseas firm is a taxable service under "Business Auxiliary Services" as defined under section 65 ....
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....ded period of limitation could not have been invoked. Reliance was placed on the following citations: a) Paul Merchants Ltd vs Commissioner, 2013 (29) STR 257 (Tri-Del) b) Commissioner vs Paul Merchants Ltd, 2014 (35) STR 1100(P&H) c) Vodafone ESSAR Cellular Ltd vs Commissioner of C. Ex, 2013 (31) STR 738 (Tri-Del) d) Commissioner vs Vodafone Essar Cellular Ltd, 2016 (41) STR 347 (Bom) e) Gap International Sourcing (India) Pvt Ltd vs Commissioner of ST,, 2015 (37) STR 757 (Tri-Del) f) A.T.E Enterprises Pvt Ltd vs Commissioner of Service Tax, 2015 (39) STR 81 (Tri-Mum) g) Commissioner of Service Tax III vs Vodafone India Limited, 2025 (8) TMI 938 SC h) Commissioner of C.....
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....uant to the orders received, the overseas company supplies the goods directly to the customers and after full payment of the invoice amount by the customer to the overseas company, pays the commission in respect of such orders to the appellant. 9. We find that in the decision in A.T.E Enterprises Pvt Ltd vs Commissioner of Service Tax, 2015 (39) STR 81 (Tri-Mum), a coordinate bench of this Tribunal, in identical fact circumstances has held that the services provided are not taxable. The relevant portions of the decision is as under: "7. The issue involved in this case is regarding whether the appellant is to be saddled with the service tax liability on an amount received by them as commission for procuring orders on behalf of ov....
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....held a view that the consideration for services rendered in India is taxable under Business Auxiliary Service. The Bench after considering the provisions of "Export Services Rules" and Board clarifications, and the decision of Microsoft Corporation (I) Pvt. Ltd. case held in favour of the assessee by recording as under : "54. In view of the above, the difference of opinion on various points is resolved as under : (i) That the business auxiliary services of promotion of market in India for foreign principal made in terms of agreement dated 1-7-2005 amount to Export of Services and the Hon'ble Supreme Court decision in the case of State of Kerala and Others v. The Cochin Coal Company Ltd.[1961 (12) STC 1 (S.C.) as also Burma....
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..... In case of Paul Merchants Ltd. case (supra) there was a difference of opinion between the Hon'ble Member (Judicial) and the Hon'ble Member (Technical) which was referred to 3rd Member, held in favour of the assessee and by a majority order it was held that : "The point of difference as mentioned in Para 60 of the referral order has been answered by third Member as under : "In view of the above discussion, the points of difference, mentioned in para 60 are answered as under :- (i) The term "export" has not been defined either in Article 280(1)(b) or in any of the article of the Constitution of India. Though the Apex Court's judgments in the case of the State of Kerala v. The Cochin Coal Company Ltd. [(1961) 2 STC....
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....ax in the sense that it is levied on commercial activities, and it is not a charge on the business but a charge on the consumers. There is nothing in Export of Service Rules, 2005 which can be said to be contrary to the principle that a service not consumed in India is not be taxed in India." In yet another case of Microsoft Corporation (I) Pvt. Ltd., also ended up with a difference of opinion on similar facts by majority decision, issue was held in favour of the assessee. 11. In the recent case of GAP International Sourcing (India) Pvt. Ltd. (supra) the co-ordinate Bench of this Tribunal held in favour of the assessee wherein the facts were more or less similar. That is, the appellant M/s. GAP International Sourcing (Indi....