Person reimbursing the freight not liable to pay Service Tax

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CESTAT, BANGALORE BENCH

Bhagyalaxmi Electroplast (P.) Ltd.

v.

Commissioner of Customs & Central Excise, Hyderabad

STAY ORDER NO. 52 OF 2012

ST/STAY/226 OF 2011

ST/397 OF 2011

JANUARY 11, 2012

Entire demand on the freight element is based on Rule 2(1)(d)(v) of the Service Tax Rules, 1994. Sub-clause (v) was inserted in Rule 2(1)(d) only on 3.12.2004 and the same cast Service Tax liability on the person paying the freight. Prima facie, the appellant did not pay the freight and therefore there is no tax liability on their part.