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CUSTOM EXCISE & SERVICE TAX APPELLATE TRIBUNAL, MADRAS
VICE-PRESIDENT, Dr. Chittaranjan Satapathy, MS. JYOTI BALASUNDARAM
Geodis Overseas (P.) Ltd. -Appellant
Versus
Commissioner of Service Tax, Chennai -Respondent
STAY ORDER NO. 487/2010 APPLICATION NO. ST/S/233/2010 APPEAL NO. ST/391/2010
Decided On : 27-09-2010
S. Krishnanandh,A.B. Niranjan Babu
Ms. Jyoti Balasundaram, Vice-President. — Heard both sides on the application for waiver of pre-deposit of service tax of Rs. 3,68,758 on reimbursable expenditure and Rs. 15,34,141 of CENVAT credit availed, together with interest and penalty.
2. The applicants herein, who are engaged in providing "Cargo Handling Services" are incurring expenditure on account of Terminal Handling Charges, Customs MOT charges, Demurrage Charges, PSA Wharfage and FCA, which are reimbursed by their clients. Prima facie, these are services for which payment is required to be made by the clients and the assessees pay on behalf of their clients and get reimbursed. Therefore, prima facie, the applicants are acting as pure agents and, therefore, the costs incurred by them are excludible from the value of the taxable services in terms of Rule 5 of the Service Tax (Determination of Value) Rules, 2006 and prima facie, the absence of a written agency contract/agency agreement with the clients is not sufficient for inclusion of the reimbursable expenditure in the value of taxable service. We, therefore, waive pre-deposit of Rs. 3,68,758 and stay recovery thereof pending the appeal. As regards the balance amount, we find that although the input service for was paid, was an exempted service, namely, "Handling of Export Cargo Service", the fact remains that the tax has been paid, and, therefore, prima facie, the applicants cannot be called upon to pay the amount of Rs. 15,74,141 once again. We, therefore, waive pre-deposit of this amount also, together with interest and penalty, and stay recovery thereof pending the appeal.
