TaxTMI 
TaxTMI 
2026 (3) TMI 1529
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....4242 2685 88 03 Non-payment of ST on income from SEZ under CHA services 340531 6811 3405 04 Non-payment of ST on the amount collected as various charges under CHA services 1501670 30033 7691 05 Non-payment of ST on the amount collected as various charges under C&F services 199668 3993 466 06 Non-payment of ST on the amount collected as transportation charges under GTA services 383727 7675 1619 07 Short payment of ST on the value received under CHA services 27217 2436 1748 08 Non - payment of ST collected in excess of the service tax paid by them in respect of CHA, C&F and GTA services and not paid 755327 Issues as per SCN dated 19.10.2011 01 Non-payment of service tax on excess amount collected as freight and other charges under CHA services 382418 7648 3824 02 Non-payment of ST on exchange gain under CHA services 249839 4997 2498 03 Non-payment of ST on the amount received as profit share from the foreign agents under BAS services 82394 1648 824 2. Two show cause notices were taken up for hearing and Adjudication Authority....
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....ent of ST on the value received under CHA services Appellant has not given any explanation in this regard nor refuted the allegation in the SCN and hence the demand needs to be confirmed 08 Non - payment of ST collected in excess of the service tax paid by them in respect of CHA, C&F and GTA services and not paid Appellant has not given any explanation in this regard nor refuted the allegation in the SCN and hence the demand needs to be confirmed Issues as per SCN dated 19.10.2011 01 Non-payment of service tax on excess amount collected as freight and other charges under CHA services OA had dropped the demand. But the Learned AA vide OIA No.035-036/16-17 has confirmed the demand after finding that the excess amounts are received as consideration and the same is nothing but mark up or commission margin, hence Includable in the value of service. 02 Non-payment of ST on exchange gain under CHA services Dropped 03 Non-payment of ST on the amount received as profit share from the foreign agents under BAS services Confirmed under Business Auxiliary Services the activity of the appellants is in relation to promotion or marketing or sale of goods p....
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....d for authorized operations. The Appellant had also draws our attention to order dated 24.09.2007 and attached list of authorized operations for Suzlon and as per Sr. No. 8 of said list, the activity of the appellant is also covered. However, in spite of making detail submission and producing the evidence as part of reply to SCN, Adjudication Authority has not considered the same while confirming the demand. 6. As regarding invoking the extended period of limitation, Learned Counsel submits that the appellant has always kept the Department informed about its activities right from October, 2003 and have in fact sought clarification from the Department and the said clarification came after a long lapse of time. It is no open to the Department to state at this stage that there has been suppression of facts. 7. As regarding the demand on other services, Learned Counsel submits that the Appellant had received the income by undertaking activities like booking of export cargo, enter into an insurance contract on behalf of the Customer arranged for transport of goods to and from the customs station...etc which have no nexus with the activities of CHA. The Appellant had collected thes....
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....is given and said demands is also unsustainable. 8. As regarding demand of Rs.54,866/- as service tax during the period from 2010-11 under BAS in Appeal No. ST/21599/ 2017, Learned Counsel submits that the appellant is not promoting anyone's business and the activities are carried out on principle-to-principle basis. The issue was considered in the matter of C C, NEW DELHI Vs KARAM FREIGHT MOVERS (2017 (4) G.S.T.L. 215 (Tri. - Del.)) where it is held that:- "12. In the present case it was recorded that the respondent was already paying service tax on commission received from airlines/shipping lines under business auxiliary service since 10-9-2004. The original authority recorded that the show cause notice did not specify as to who is the client to whom the respondent is providing service. Original authority considered both the scenario, airline/shipping lines as a client or exporter/shipper as a client. In case the respondent is acting on behalf of airlines/shipping lines as client, it was held that they are covered by tax liability under BAS. Further, examining the issue the original authority viewed that commission amount is necessarily to be obtained out of transacti....
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....ules, 2006. The Learned AR further submits that the modus operandi adopted by the appellant is that when an importer approaches the appellant for import of cargo, Appellant quotes a rate for the entire activity, Appellant contacts the overseas counter partner, The exporter outside the country delivers the goods to the counterpart; The counterpart arranges the shipping, mostly on a pre-paid basis; Once the goods are imported, the Appellant prepares documents and hands over documents of title as well as delivery order to the importer.) The importer or the CHA appointed by them arranges for clearance; The Appellant recovers charges incurred by his counterpart from the importer apart from the expenses incurred by him in connection with the delivery of goods. 11. As regarding exclusion of reimbursable expenses and relying on the judgement of Hon'ble Supreme Court in the case M/s. Intercontinental Consultants and Technocrats Pvt. Ltd (supra), Learned AR submits that the ratio of the above decision is not applicable since the findings is not only about inclusion of reimbursable expenses in the value of services. The appellant has collected more than the actual expenses and they can....
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....ly with the case with regard to CHA services and C&F services where appellant has been regularly paying and the differential amount of Rs. 31,401/- and Rs. 2,04,127/- respectively cannot be sustained since there is no suppression of facts and the demand beyond the normal period of limitation. We also find that the differential service tax has been demanded on the differential value claimed as reimbursable expenses by the appellant. The commissioner has invoked Rule 5 of the Service Tax (Determination of Value) Rules, 2006 for demanding the differential tax. We find that this issue is no longer res-integra and as much as the Hon'ble Supreme Court in the case of M/s. Intercontinental Consultants and Technocrats Pvt. Ltd (supra) wherein the Hon'ble Supreme Court has held Rule 5(1) of Service Tax (Determination of Value) Rules, 2006 is not good law, since the power to make rules can never exceed or go beyond the section which provides further charge or collection of the Service Tax. In view of the above we do not find any reason to sustain the demands which are based on invoking Rule 5 as discussed above. 16. As regarding demand of Rs. 84,866/- as service tax under BAS during the pe....