2025-VIL-2092-CESTAT-MUM-ST
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SERVICE TAX CESTAT Cases

Service Tax - BAS, Commission income, Indenting Agent – Providing of support services in respect of imports from foreign suppliers and selling locally to customers directly, as well as selling such goods on 'high seas sale' basis - The appellant received commissions on account of providing these services to their foreign suppliers – Demand of service tax under the category of Business Auxiliary Service (BAS) - Whether the services provided by the appellant and the receipt of commission earned by them for such services in the form of commission on 'high seas sales' and indenting commission charges, are liable for levy of service tax - HELD - The appellants act as indenting agent and provides the service of selling the goods directly to the customers of such foreign entities, including sale on high seas sales basis, for which they only get commission/indenting commission. There is no evidence of an arrangement between the appellants and the foreign entities wherein the appellants are empowered to make any obligation on behalf of the overseas entity or to bind overseas entity to any contractual obligation - The content in the agreement clearly provide that no services were provided by the appellants to the end customers on behalf of the overseas entity. Thus, under such circumstances, it cannot be said that the appellant has acted as an intermediary in the dealings between the overseas entities and their customers in India - The services provided by the appellant to the overseas entities qualify as export in terms of Rule 3 of the Export of Service Rules, 2005. As per the CBIC Circular, the accrual of benefit from the services provided by the appellant and their use for the benefit of foreign entity would qualify for export, and there does not involve service of BAS - The impugned order is set aside and the appeal is allowed
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