Prashanti Agencies Vs. Commissioner (St) Central Excise

Prashanti Agencies vs Commissioner (St) Central Excise

Type Court Judgment Court Customs Excise and Service Tax Appellate Tribunal CESTAT Mumbai Decided Jan 24, 2007

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Citation: sooperkanoon.com/44665
Court: Customs Excise and Service Tax Appellate Tribunal CESTAT Mumbai
Judge: A Wadhwa, V T M.
Decided On: Jan 24, 2007
Subject: Service Tax

Case Summary

AI-generated summary - not the official court judgment text.

Service Tax

Key legal issue: Service Tax

Parties & Advocates

Appellant / Petitioner

Prashanti Agencies

Respondent

Commissioner (St) Central Excise

Legal References

Reported In: (2007)9STJ120CESTAT(Mum.)bai

Excerpt

.....the appellants contention duly represented shri rajiv luthia advocate for the appellant and shri p.k. katiyar ld. sdr for the respondents in terms of the agreement entered into by the appellant with m/s reliance industries ltd. they are appointed as del credere agent, whose job is to promote the sales of the principals product and to inspire the customers to purchase the product by placing necessary orders. such orders procured by the firm from their customers were complied with by m/s. reliance industries by supplying the product directly to the customers. delivery challan and invoices and other documents on the customers was being raised by m/s. reliance industries and the appellants were entitled to commission only after the sale proceeds were realized by m/s. reliance industries. as such, it is their contention that they never deat with the goods and cannot be held to be clearing and forwarding agents.3. after appreciating the contentions raised by the ld. advocate and after going through the impugned order, we find that the tribunal in the case of raja rajeshwari intel, polymers (p) ltd. v. cce bangalore 2005 istj 1025 (cestat-bangalore) has held that del credere agents do not fall under the category of clearing & forwarding agents and as such services rendered by them cannot fall under the said category.reference is also made to larger bench decision of the tribunal in the case of larsen & toubro ltd. reported in 2006 (3) str 321 (tri.lb) laying down that commission agents booking orders on commission basis and not dealing with the goods cannot be helo to fall under the category of clearing and forwarding agents.inasmuch as, the issue stands decided by the above decision of the tribunal, we set aside the impugned order and allow the appeal with consequential relief to the appellants.

Full Judgment

1. Demand of service tax stands confirmed against the appellant as Clearing and Forwarding Agents by holding that they were acting as consignment sales agent of M/s. Reliance Industries Ltd. and were appointed Del Credere Agent of M/s. Reliance Industries.

2. The appellants contention duly represented Shri Rajiv Luthia Advocate for the appellant and Shri P.K. Katiyar Ld. SDR for the respondents in terms of the agreement entered into by the appellant with M/s Reliance Industries Ltd. they are appointed as Del Credere Agent, whose job is to promote the sales of the principals product and to inspire the customers to purchase the product by placing necessary orders. Such orders procured by the firm from their customers were complied with by M/s. Reliance Industries by supplying the product directly to the customers. Delivery challan and invoices and other documents on the customers was being raised by M/s. Reliance Industries and the appellants were entitled to commission only after the sale proceeds were realized by M/s. Reliance Industries. As such, it is their contention that they never deat with the goods and cannot be held to be clearing and forwarding agents.

3. After appreciating the contentions raised by the Ld. Advocate and after going through the impugned order, we find that the Tribunal in the case of Raja Rajeshwari Intel, Polymers (P) Ltd. v. CCE Bangalore 2005 ISTJ 1025 (CESTAT-Bangalore) has held that Del Credere Agents do not fall under the category of Clearing & Forwarding Agents and as such services rendered by them cannot fall under the said category.

Reference is also made to Larger Bench decision of the Tribunal in the case of Larsen & Toubro Ltd. reported in 2006 (3) STR 321 (Tri.LB) laying down that commission agents booking orders on commission basis and not dealing with the goods cannot be helo to fall under the category of Clearing and forwarding agents.

Inasmuch as, the issue stands decided by the above decision of the Tribunal, we set aside the impugned order and allow the appeal with consequential relief to the appellants.

Same Court & Year Customs Excise and Service Tax Appellate Tribunal CESTAT Mumb... Same Parties Prashanti Agencies vs Commissioner (St) Central Excise Same Subject Service Tax Same Judge A Wadhwa, V T M.