Difference between pure agent and consignee agent

Dear Experts,

Please explain difference between pure agent and consignee agent as per new valuation and reimbursement rule in service tax 2006.

Thanks

 

 

Replies (2)

Hi,


Pure Agent
As per Rule 5 of Determination of Value for Service Tax Rules, 2006, 'pure agent' means the person who procures services on behalf of his client, while providing his own taxable service. In other words, he is the mediator between some service provider and his client. The value of such service procured on behalf of client is excludable from taxable value for payment of service tax, if and only if (i) that service provider charges the client directly, (ii) pure agent does not holds right of such services (iii) pure agent receives the actual amount of such service from the client.


Consignee Agent or clearing and forwarding agent

The definition of clearing and forwarding agent has been given under clause (25) of section 65. It provides that: "clearing and forwarding agent means any person who is engaged in providing any service, either directly or indirectly, connected with the clearing and forwarding operations in any manner to any other person and includes a consignment agent". Therefore, a service will fall under the clearing and forwarding agent service, if it includes § a person; § engaged in providing any service connected with the clearing and forwarding operations; and § includes a consignment agent. You can visit on the below link and get all the information about clearing and forwarding agent


Consignee means "The named party to whom the goods are sent, for example, on a Bill of Lading or other transport document. In practice most Bills of Lading are consigned 'to order' which means the importer can authorise someone else to collect the goods.
 

Dear Sir,

What should i do to convert consignment agent into pure agent so that as a pure agent he does not include reimbursement of expenses in his taxable value. Please advice.

Thanks

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