Custom, Excise & Service Tax Tribunal
Cce & St, Ludhiana vs Gurdev Handling Pvt.Ltd on 3 January, 2018
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL,
SCO 147-148, SECTOR 17-C, CHANDIGARH-160017
DIVISION BENCH
Court-I
Appeal No.ST/53226/2015-Cu (DB)
(Arising of OIO No.LUD-EXCUS-000-COM-002-15-16 dt.13.05.2015 passed by the CCE & ST, Ludhiana)
Date of hearing/Decision:03.01.2018
CCE & ST, Ludhiana Appellant
Vs.
Gurdev Handling Pvt.Ltd. Respondent
Present for the Appellant: Shri G.M.Sharma, AR Present for the Respondent: Shri Jagmohan Bansal, Advocate Coram: HonbleMr. Ashok Jindal, Member (Judicial) HonbleMr.Devender Singh, Member (Technical) FINAL ORDER NO. 60012/2018 PER: ASHOK JINDAL The Revenue is in appeal against the impugned order wherein the Commissioner has dropped the show cause notice issued to the respondent.
2. The brief facts of the case are that the respondent is registered under the category of clearing and forwarding agent service and paying service tax thereon. On information that the respondent is paying service tax on less amount and receiving higher amount from the service recipients, therefore, a show cause notice was issued to the respondent. On scrutiny of the documents, it revealed that the respondent is providing clearing and forwarding services in respect of import cargo and transportation of such import to various service recipients. For rendering customs clearing services, they were utilizing services of registered CHAs by engaging them as their sub-contractors. These CHAs were realizing their service charges, around Rs.200/- per container from the respondent. Further, for providing said CHA services, the respondent was raising invoices to their clients for Rs.300/- per container as their service charges terming the same as clearing charges and was discharging service tax on the said amount. It further transpired that the respondent was also raising debit notes to their clients for various expensed like documentation expenses, crane handling charges, labour charges, weighment expenses, miscellaneous expenses etc. and the service tax on said debit notes was not discharged by the respondent. The respondent was also raising invoices for transportation charges, for transporting import cargo, got cleared by them, to their clients premises and service tax under GTA service was being discharged by their clients as consignees. Therefore, a show cause notice was issued to the respondent to include the amount of debit notes and transportation charges in the assessable value under the category of clearing and forwarding agent service. The show cause notice was adjudicated, the proceedings against the respondent were dropped. Against the said order, the Revenue is before us.
3. Ld.AR submits that as the services provided by the respondent are the clearing and forwarding services and any amount received towards providing of services is includable in the assessable value. The Commissioner has fell in error by dropping the show cause notice against the respondent without specifying whether the respondent were providing service of clearing and forwarding agent service. Moreover, the amount received by the respondent is includable in the assessable value. Further, the Commissioner has gone beyond the show cause notice holding that the respondent was not providing CHA services, but were in fact, acting in the capacity of pure agent. It is also contended that the Commissioner has not given any finding on the transportation charges for which he has dropped the demand. Ld. AR also submits that there is no written agreement provided by the appellant, therefore, written agreement relied by the Ld.Commissioner cannot be relied upon. It is prayed that the impugned order is to be set aside.
4. On the other hand, Ld. Counsel for the respondent opposed the contention of the Ld.AR and submits that in reply to the show cause notice, the respondent contended that they themselves got registered wrongly, in fact they are not clearing and forwarding agents and the service provided by them are of CHA services. As the respondent is not registered as CHA, no service tax is payable by the respondent. He fairly admitted that the Commissioner has not given any finding on the merit of the case whether the activity undertaken by the respondent is Clearing and Forwarding Agent Services or not. He also contended that in the show cause notice as well as in the appeal filed by the Revenue, the fact has been recorded that the respondent has transported the cargo to the place of service recipient, who discharged service tax on the said amount under the category of GTA service, therefore, on the said amount, the service tax cannot be demanded from the respondent again. Therefore, he fairly submits that the first issue of classification of the service in question is to be decided by the adjudicating authority. For that purpose, the matter may be remanded back to the adjudicating authority.
5. Heard both sides.
6. We have gone through the impugned order. In the impugned order, the ld. Commissioner has recorded the finding that they do not qualify for CHA service but has not given any finding on classification of their service. Whether the issue can be classified under the category of Clearing and Forwarding Agent Service or not, therefore, the matter needs consideration whether the activity undertaken by the respondent fall under the category of clearing and forwarding agent service or not. Further, we observe that in the show cause notice as well as in the appeal papers filed by the Revenue it has been alleged that the respondent were receiving transporting charges for transporting import cargo cleared to their clients under the category of GTA service who was discharging service tax as consignee. On this fact, no finding has been given by the adjudicating authority. Therefore, before passing any order, the adjudicating authority shall give a concrete and definite finding on the said issue. Further, we find that on the service of transportation, the service tax has been discharged by the service recipient, in that circumstance, no service tax is payable by the respondent. The adjudicating authority shall also examine the issue of pure agent service.
7. In view of above analysis, we set aside the impugned order and remand the matter back to the adjudicating authority for fresh adjudication of the matter as discussed hereinbefore after affording a reasonable opportunity to the respondent to present their case.
(dictated and pronounced in the court)
(DEVENDER SINGH) (ASHOK JINDAL)
MEMBER (TECHNICAL) MEMBER (JUDICIAL)
mk
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Appeal No.ST/53226/2015