Decided on January 07,2015

A.T.E. Enterprises Pvt. Ltd. Appellant


M.V.RAVINDRAN, J. - (1.)THIS appeal is directed against Order -in -Original Nos. 50 -53/ST -II/RS/2013, dated 30 -8 -2013 passed by Commissioner of Service Tax, Mumbai -II. The relevant facts that arises for consideration are the CERA audit party noticed that the assessee/appellant had obtained orders from various companies and passed them on to the foreign company; on receiving such orders, the foreign companies deliver the goods to Indian companies and paid a commission to the appellant which was in foreign currency. CERA audit party entertained a view that the appellant is liable to discharge service tax liability under "Business Auxiliary Services (BAS)" on such amount received by then as commission from foreign parties as they were promoting, gathering market information, which would fall under the category of promotion, or marketing of goods/services. Such CERA audit enquiry, the appellant gave a detailed reply. The said explanation was not accepted by the audit party and a show cause notice dated 19 -3 -2009 was issued to the appellant directing them to show cause as to why the amount of service tax liability of Rs. 5,32,96,615/ - being not demanded and recovered from them along with interest and also why penalties should not be imposed on them under various sections. Appellant contested the show cause notice on merits. The adjudicating authority after following the due process of law, did not accept the contentions raised by the appellant and confirmed the demand of service tax along with interest and imposed penalties under various sections.
(2.)The learned Counsel appearing on behalf of the appellant would take us through the entire show cause notice and the order -in -original. He would also take us through a sample agreement entered by appellant with the overseas manufacturers and submit that the duties which are cast upon the appellant are only to procure the orders and pass it on to the overseas manufacturers, who on execution and receipt of payment, will give the commission to the appellant, as agreed upon. He would submit that the adjudicating authority has confirmed the demands based upon the stay order passed by the Tribunal in the case of Microsoft Corporation Indian Private Ltd. He would also submit that the issue is no more res integra and has been decided in favour of the assessee in the following cases:
(a) Vodafone Essar Cellular Ltd. v. C.C.E., Pune - : 2013 (31) S.T.R. 738.

(b) Paul Merchants Ltd. v. CCE, Chandigarh - : 2013 (29) S.T.R. 257 (Tri. -Del.).

(c) Microsoft Corporation Indian Private Ltd. v. CST, New Delhi - : 2011 - TIOL -1508 -CESTAT -Del. : 2014 (36) S.T.R. 766 (T).

(d) GAP International Sourcing (India) Pvt. Ltd. v. CST - : 2014 -TIOL -465 -CESTAT -Del. : 2015 (37) S.T.R. 757 (T).

(e) CST, Mumbai -III v. SGS India Pvt. Ltd. - : 2014 -TIOL -580 -HC -MUM -S.T. : 2014 (34) S.T.R. 554 (Bom.).

(f) Blue Star Ltd. v. CST - Final Order No. A/1611/14/CSTB/C -1 in Appeal No. ST/74/08 -Mum.

It is his submission that in view of the above, the impugned order be set aside.

(3.)THE learned departmental representative on the other hand would draw our attention to the findings recorded in the order -in -original and submit that the assessee has not disputed that they are procuring orders from the Indian companies and passing them on to the overseas manufacturers. It is his submission that the appellant has not disputed that all the activities undertaken and services provided are in relation to the sale of goods in India and the consideration has been received only for the services provided in India in respect of sale of goods in India. He would also draw our attention to the findings recorded by the adjudicating authority as to that the appellant was not only procuring the orders but they are also assembling and organizing and collects receivables from the clients.

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