Custom, Excise & Service Tax Tribunal
Ruth Shipping Agencies Private Ltd vs Commissioner Of Central Excise, ... on 25 March, 2010
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
SOUTH ZONAL BENCH AT CHENNAI
Appeal No.ST/188/2009
[Arising out of Order-in-Revision No.24/COMMR/ST/2008 dated 18.12.2008 passed by the Commissioner of Central Excise, Thirunelveli]
For approval and signature:
Honble Ms.JYOTI BALASUNDARAM, Vice-President
1. Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982? :
2. Whether it should be released under Rule 27 of the
CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? :
3. Whether the Member wishes to see the fair copy of
the Order? :
4. Whether Order is to be circulated to the Departmental
Authorities? :
Ruth Shipping Agencies Private Ltd.
Appellants
Versus
Commissioner of Central Excise, Thirunelveli
Respondent
Appearance:
Shri J.ShankarRaman, Advocate Shri C.Rangaraju, SDR For the Appellants For the Respondent CORAM:
Honble Ms.Jyoti Balasundaram, Vice-President Date of hearing : 25.3.2010 Date of decision : 25.3.2010 Final Order No.____________ The appellant herein is a CHA who had received brokerage charges from steamer agent for providing services which appeared to be classifiable under Business Auxiliary Service during the years 2004-05 and 2005-06. Brokerage charge of Rs.5,44,305/- had been collected during the above period and, therefore, the CHA was held to be liable to pay service tax of Rs.55,520/-. Show-cause notice proposing recovery of the amount above mentioned invoking the extended period, and proposing recovery of interest and imposition of penalty was issued; notice was adjudicated by the Asst. Commissioner who accepted the assessees contention of non-liability of service tax. The order was reviewed by the Commissioner who held that assessees had received commission for arranging containers for their client for the purpose of export and hence the assessees were liable to pay service tax under the category of Business Auxiliary Service. He, therefore, confirmed the demand as raised in the notice together with interest but dropped penal proceedings. Hence this appeal.
2. I have heard both sides. It is an undisputed fact that appellants arranged containers for their clients, who are the exporters, through steamer agent and the steamer agent pays brokerage to the assessees for the above service. The secondary services such as arranging for containers are used by the primary service provider for the export of services. In the light of Circular No.56/5/2003- dt. 25.4.2003 issued by the CBEC, holding that since the secondary services ultimately get consumed/merged with services that are being exported, no service tax would be leviable on such secondary services, the assessees cannot be held liable to pay service tax. The above view finds support from Tribunals decision in Lee & Muir Head Pvt. Ltd. Vs Commissioner of Service Tax, Bangalore [2009 (14) STR 348]. In this view of the matter, I set aside the impugned order and allow the appeal without recording any finding on the other submissions raised by the assessees that the order-in-revision is a departure from the revision notice.
(Dictated and pronounced in open court) (JYOTI BALASUNDARAM) VICE-PRESIDENT gs 5