2026 (6) TMI 638

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... 2. Brief facts of the case are that the appellant is registered under Custom House Agent Service, Transport of Goods by Road Service and Business Auxiliary Service. During the course of audit of the accounts of the appellant, it was noticed by the department that the appellant had paid ocean freight charges to their principals. It is found that the appellant had added some mark-up value / margin on the ocean freight in their bills raised on their customers during the period from October 2012 to September 2013 and collected the same from their clients. It was also found that the appellant collected share profits from their clients. It appeared that the aforesaid mark up value in ocean freight and share profit collected from their clients ar....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... case for the immediate preceding period (January 2012 to September 2012) on the same issue, this Tribunal vide Final Order No.40854/2024 dated 12.07.2024 had allowed the Appeal and set aside the impugned Order. C. CESTAT, Ahmedabad in the case of Gudwin Logistics, (2010) 18 STR 348 (Tri.-Ahmd) had held that Ocean Freight is not liable to service tax. The Hon'ble Supreme Court in the case of Baroda Electric Meters, 1997 (94) ELT 13 (SC) had also held that when ocean freight actually paid is less than the amount collected, the differential amount cannot be included in the assessable value as the same is profit. The above decisions were also taken note of by this Hon'ble Tribunal while passing Final Order in the Appellant&#39....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....r Order-in-Appeal No. 16/2014 dated 24.02.2014 had set aside a similar demand, that order was accepted only on account of low revenue implications under the Government's litigation policy. In terms of Section 35R of the Central Excise Act, 1944, as made applicable to service tax by Section 83 of the Finance Act, 1994, such acceptance does not have precedential value. Therefore, the issue must be decided independently on merits. B. With effect from 01.07.2012, service tax is leviable on all services other than those covered by the negative list or specific exemptions. Under Section 65B(44), "service" means any activity carried out by one person for another for consideration, and under Sections 65B(51) and 66B, such activity is taxab....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....avour. Relevant paragraphs are reproduced below: "4. We have heard the rival submissions. We find that the issue pertains to the appellant having added some markup value/ margin on the ocean freight charges and collected the same from their clients. Revenue is of the opinion that the mark up value in ocean freight is liable for service tax under Steamer Agent Service. 5. We find that the issue is no longer res integra. The Hon'ble Supreme Court in the case of Baroda Electric Meters Ltd. v. Collector [1997 (94) E.L.T. 13 (S.C.)] held as under; "The Tribunal accepted the position that equalised freight was charged by the appellant from everyone, but proceeded to say that even though freight cannot be a part of the a....