Consignment Agency

This query is : Resolved

Jai Jain (Querist)
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21 October 2008 Dear All,
Please try to solve this query.
We are consignment agents for one of the companies in south. We keep stocks on behalf of the company & the co. provides us comission (about 3% on sales value). The total comission doesnt exceed 3.5 lakhs in a year. The responsibility of the sales & collection is completely ours.

We used to pay service tax before (have registeration as clearing & forwarding agents) & when we learnt about the exemption limits (now 10 lakhs, earlier 8L & earlier than that 4 lakhs), we stopped paying, but we still file the returns on normal dates.

Now, we went to department for cancellation of our registration as the comission is far below the exemption limit. But, the department says that we are liable for service tax & no exemption is available for C & F agents.

Please advice on the above,

Thanking you

Bhaskaran Chackrapani Warrier

Bhaskaran Chackrapani Warrier (Expert)
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22 October 2008 If you are doing the service under a brand name or under the trade name of another person, then you are not eligible for threshold exemption. Otherwise you observation is correct.

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