TaxTMI 
TaxTMI 
2026 (8) TMI 1804
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....usiness auxiliary services, renting of immovable property services and transportation of goods by road services under reverse charge. During the course of verification of the appellant's records, the department noticed that in addition to providing CHA services, the appellant also arranges for the transportation of export cargo and import cargo by sea through shipping agencies. The department was of the view that the appellant is providing services to their customers by agreeing to take responsibility for moving the containers to the agreed destinations at a specific rate. The appellant fulfils its obligation by booking the containers with the liners/shipping companies/agencies and arranges for the movement of the customer's cargo to the desired destination located outside India. The charges for the movement of the containers are fixed as mutually agreed by the appellant and the shipping companies/agencies based on the destination and the size of the containers. The appellant also makes arrangements with the shipping companies/agencies for the provision of international freight services for the transportation of containers on their own account. Further, the appellant also arranges ....
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....y assess and disclose the tax payable in its ST-3 returns. After due process, the Adjudicating Authority, by the impugned order, confirmed the demand along with equivalent penalty under Section 78. Aggrieved, the appellant is in appeal. 5. Shri S. Muthu Venkatraman, Ld. Advocate for the appellant, submitted that the appellant, a Government of India enterprise engaged in logistics and CHA activities, arranges international and domestic transportation of export and import cargo by sea and air; that in the course of business it undertakes transportation of goods by contracting with customers in India and correspondingly engaging shipping lines/airlines/overseas agencies for execution of the transportation; that invoices raised on customers include the freight component (ocean/air) with a mark-up, along with ancillary charges such as LCL, documentation, terminal handling and delivery order charges, on all of which service tax has been duly discharged, but not on the ocean/air freight, in the bona fide belief that the same was not taxable/exempt during the relevant period. It was contended that the activity, being purely transportation of goods by sea/air, cannot be re-classified as ....
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....nai-II, 2018-TIOL-3311-CESTAT-Mad.; M/s. LA Freight Pvt. Ltd. Vs. Commissioner of Service Tax, Chennai, 2018 (3) TMI 113 - CESTAT, Chennai; Seamax Logistics Ltd. Vs. CCE & ST, Tirunelveli, 2018 (7) TMI 262 - CESTAT, Chennai; and K. Steamship Agencies Pvt. Ltd. Vs. CCE, Chennai-II, 2019 (1) TMI 440 - CESTAT, Chennai. On limitation, it was contended that being an interpretational dispute, the extended period could not be invoked, relying on Star Freight Pvt. Ltd. Vs. CST, Ahmedabad, 2023 (9) TMI 71, and M/s. International Clearing and Shipping Agency Vs. Commr. of GST & CE, Chennai North, 2025 (2) TMI 615 - CESTAT, Chennai. 6. Shri Anoop Singh, Ld. Authorised Representative, fairly submitted that the issue is no longer res integra and stands settled in the appellant's favour, and furnished two more decisions M/s. Fairmacs Shipping and Transport Services Pvt. Ltd. Vs. Commr. of GST & CE, Chennai, 2024 (9) TMI 1828 - CESTAT, Chennai, and M/s. Team Global Logistics Pvt. Ltd. Vs. Commr. of GST and CE, Chennai, 2023 (12) TMI 568 - CESTAT, Chennai. 7. We have heard both sides and perused the materials available on record. 8. We find that the dispute falls to be examined across two....
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.... with documentation, terminal handling and delivery orders have already suffered tax, the SCN itself acknowledges this fact. It is only the freight component, and the margin embedded in it, that has been sought to be re-characterised as an independent 'business support service'. Where the principal activity is non-taxable by legislative design, the profit or margin earned in the course of that very activity cannot be severed and taxed as if it were consideration for a distinct service. 10. This view is not one of first impression. It has been consistently taken by this Tribunal on materially identical facts, including in the appellant's own case in M/s. Balmer Lawrie and Co. Ltd. Vs. Commissioner of Service Tax, Delhi-II, 2023 (5) TMI 100 - CESTAT, New Delhi, and in Gudwin Logistics, Agility Logistics, APL Logistics, Greenwich Meridian Logistics, Interfreight Services, PVGT Freight Forwarders and Logistics, LA Freight, Seamax Logistics, K. Steamship Agencies and United Shippers, all cited supra, each holding that the mark-up earned by a CHA or freight forwarder on ocean or air freight, recovered on a principal-to-principal basis, does not constitute consideration for 'business s....