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1. Revenue proceeded against the appellant on the ground that they had failed to declare the whole value of service rendered to their clients resulting in short payment of Service Tax. The appellants are providing taxable service under the category "Clearing and Forwarding Agents" as defined in the Finance Act, 1994. The appellants provide the above services to M/s. India Petrochemicals Corporation Ltd., Vadodara (hereinafter referred to as M/s. IPCL). In the capacity of the C&F Agents, they receive goods from M/s. IPCL for forwarding the same to the buyers. They receive service charges/commission for Godown sales and PDA sales. PDA sale means a transaction where customer books directly from M/s. IPCL for the benefit of free delivery of goods. On the PDA sales, the appellant receive charges of Rs. 250 per MT. On these charges, no Service Tax has been paid. The appellants submitted that these charges are on account of their acting as 'Del Credere Agent for M/s. IPCL. It was clarified that in respect of PDA sales, they ensure, as per their agreement with M/s. IPCL, that the payments are collected in time from their customers and in case of any delayed payments, reimburse the same to M/s. IPCL and thereafter recover the outstanding amount from the customer in consultation with the company. According to the appellant, the amount paid by M/s. IPCL to them on account of their acting as Del Credere Agency is not in the nature of commission for C&F Agency, as they are not handling the goods relating to the transaction either directly or indirectly. The adjudicating authority, apart from confirming the alleged short levy, imposed equal penalty under Section 78 of the Finance Act, 1994. Penalties were imposed under Sections 75A and 76 of the Act. Interest was also demanded under Section 75. The appellants were not successful before the Commissioner (Appeals). They have come before this Tribunal strongly challenging the OIA.

Further, he urged that the Commissioner (Appeals) has not at all taken into consideration all the points urged by the appellant and has held that Del Credere Agency is also C&F Agency work.

5. The learned JDR reiterated the points in the OIA.

6. We have gone through the rival contentions. The point at dispute is whether the commission received on account of Del Credere Agency is liable to Service Tax under the category of C&F Agents as defined in Finance Act, 1994. It is very clear that as per the Agreement entered between the appellant and M/s. IPCL, they indemnify M/s. IPCL against the default in payment of creditors. For this purpose, they receive commission at the rate of Rs. 250 per MT. In these cases, they do not even handle the goods. The customers directly book orders and the Principal sends the goods to the customers. In case the customers default in payment, the appellant undertakes the liability and compensates M/s. IPCL. In our view, this service cannot come within the purview of C&F operations. Even though the appellant is a C&F Agent, every activity undertaken by him cannot be brought within the purview of C&F operations. In view of the above observations, we do not find any merit in the OIA. We allow the appeal with consequential relief.