2018 (3) TMI 631 – CESTAT CHENNAI – TMI – Cargo Handling services – appellant are consolidation freight forwarding agent dealing with import / export cargo – Held that: – none of them involve handling of cargo physically and these are activities which are mainly monitoring, managing the consolidation / de-consolidation of multiple / bulk cargo for which various charges are collected – these fees / charges are to be attributed to the cargo handling service' without identifying the presence of physical handling of cargo by the appellant – there is no evidence to identify the appellant's activities as “Cargo Handling Agent”.
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Business Auxiliary services – incentives received from the liners based on the quantum of freight business made available to the liners – Held that: – the matter stands settled by the Tribunal decision in the case of Bax Global India Ltd Vs CST Chennai [2017 (9) TMI 1264 – CESTAT CHENNAI], where it was held that The appellant pre-books the slots even before the
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o Handling Service, Business Auxiliary Service and Goods Transport Agent Services for the period 16.08.2002 to 31.03.2006. Further, certain cenvat credit availed by the appellant on input services were also ordered to be reversed. Penalties under Section 76 & 78 of the Finance Act, 1994 were also imposed on the appellant. 3.1 Contesting the findings of the impugned order on two issues, the Ld. Counsel submitted that there is no service tax liability on the appellant under 'Cargo Handling Service' and 'Business Auxiliary Service'. The nature of work undertaken by the appellants is briefly mentioned in the impugned order itself. They are a consolidation freight forwarding agent dealing with import / export cargo. They enter into agreement for similar activities abroad. As per the arrangements, when a cargo arrives in India under the cover of Master Airway Bill, covering more than one customer, such consolidated cargo will have to be split and distributed to the respec
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rred by the counterpart in foreign country for bringing the cargo to the port of export which is collected from the client in India. 3.2 The Ld. counsel submitted that none of these charges are with reference to the physical handling of any of the cargo. They are not cargo handling agents and their core area of work is consolidation and freight forwarding. The original authority summarily presumed that these activities are cargo handling services and accordingly proceeded to confirm the service tax liability. 3.3 Regarding service liability under BAS, it is submitted that the said service tax was confirmed on the incentives received from the liners based on the quantum of freight business made available to the liners. This is actually a sort of profit on freight booking and there is no business promotion of any liner to any particular client. It is submitted that this issue stands settled in favour of the appellant by Tribunal's decision in the case of Bax Global India Ltd. Vs CST
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ues, the Id. A.R submitted that the amount was paid only after being pointed out by the officers. Accordingly, the penal consequences will follow. It is also submitted that in respect of reversal of credit, there is no evidence of payment of interest for delayed reversal. 5. We have heard both sides and perused the appeal records. 6. The appellants are contesting only two issues. On the first issue, we have thoroughly examined their nature of activities as captured in the impugned order as well as elaborately submitted by the appellants in their appeal. The various nature of fee and charges collected by the appellants from the client have already been explained by the Id. counsel and reproduced above. On perusal of the activities for such consideration, it is clear that none of them involve handling of cargo physically and these are activities which are mainly monitoring, managing the consolidation / de-consolidation of multiple / bulk cargo for which various charges are collected. We
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hat the amounts have been paid before issue of show cause notice. The fact of payment of interest on delayed reversal of credit needs to be verified by the authorities below. Wherever applicable such interests are to be paid by the appellant which the counsel fairly concedes. She submitted that on factual verification of non-payment of interest, the same will be paid. 9. Considering the facts and circumstances of the case, the payment of tax under GTA service under reversal credit before issue of SCN, we find that the provisions of Section 80 can be invoked to waive the penalties imposed on the appellant. Accordingly, the penalties are waived in terms of Section 80 of the Finance Act, 1994. 10. In view of the discussion and analysis, the appeal is partly allowed on the above terms with consequential if any, as per law. (dictated and pronounced in court) – Case laws – Decisions – Judgements – Orders – Tax Management India – taxmanagementindia – taxmanagement – taxmanagementindia.com –
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