Case Law Details
Raaga Associates Pvt Ltd Vs Commissioner of CE & ST (CESTAT Chandigarh)
The appellant has entered into contact with Syntech (HK) Technology Ltd. Hongkong (STLH) in order to short list states for launching Gionee mobile phones and make arrangement for advertisement for this. Further, the appellant undertook to set up STLH office in India, to recruit services companies, advertisement agency and service staff and appointed distribution partners for the states short listed for launch of Gionee mobile phones. Thereafter, STLH entered in separate contracts with Distribution partners to purchase phones owned by STLH and resale the same in the Indian territory along with marketing and promoting of the same. The mode of payment of the services rendered by the appellant is 1% of the value of goods imported in India by these distributors in the first year and 0.8% in subsequent years.
The Revenue is of the view that the services rendered by the appellant is an intermediary service. Rule 2(f) of POPS Rules, 2012 defines the term “intermediary” which means a broker, an agent or any other person, by whatever name called, who arranges or facilitate a provision of a service (herein called the main service) or supply of goods between two or more persons, that does not into a person who provide the main service or supply of goods on his account.
From the facts of case, we find that the appellant nowhere of providing service amongst two or more persons, in fact, the appellant is providing service to set up STLH office in India, recruitment service companies, advertisement agency, service staff and also appoint Distribution partners for states short listed for launch of Gionee mobile phones. These services nowhere include any sale of goods and the appellant is nowhere involved in the providing the service of sale of goods. In fact, for sale of goods, M/s STLH has separately entered into contract with the Distribution partners who import goods in their own names and sell in India. The appellant is neither related to import of goods nor any sale of goods and also nor concern with the payment against those goods, therefore, it cannot be said that the appellant is an “Intermediary” as per Rule 2(f) of POPS Rules, 2012.
FULL TEXT OF THE CESTAT JUDGMENT
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