{"id":35540,"date":"2009-02-24T00:00:00","date_gmt":"2009-02-23T18:30:00","guid":{"rendered":"https:\/\/www.legalindia.com\/judgments\/commissioner-of-central-excise-vs-ms-kulcip-medicines-p-ltd-on-24-february-2009"},"modified":"2017-01-30T01:57:23","modified_gmt":"2017-01-29T20:27:23","slug":"commissioner-of-central-excise-vs-ms-kulcip-medicines-p-ltd-on-24-february-2009","status":"publish","type":"post","link":"https:\/\/www.legalindia.com\/judgments\/commissioner-of-central-excise-vs-ms-kulcip-medicines-p-ltd-on-24-february-2009","title":{"rendered":"Commissioner Of Central Excise vs M\/S Kulcip Medicines (P) Ltd on 24 February, 2009"},"content":{"rendered":"
Punjab-Haryana High Court<\/div>\n
Commissioner Of Central Excise vs M\/S Kulcip Medicines (P) Ltd on 24 February, 2009<\/div>\n
CEA No.34 of 2006                     1\n\n           IN THE HIGH COURT OF PUNJAB AND HARYANA AT\n                        CHANDIGARH.\n\n                         CEA No. 34 of 2006\n                         Date of decision 24 .2.2009\n\n\nCommissioner of Central Excise, Panchkula                ...Appellant\n\n                         Versus\n\nM\/s Kulcip Medicines (P) Ltd.                            ... Respondent.\n\nCORAM:       HON'BLE MR. JUSTICE M.M. KUMAR\n             HON'BLE MR. JUSTICE H.S. BHALLA\n\nPresent:     Mr.Gurpreet Singh, Central Govt. Standing Counsel\n\n             Mr. A.R.Madhav Rao, Mr. Tarun Jain and Mr. Sandeep\n             Goyal, Advocates for the respondent.\n\n\n1. Whether Reporters of local papers may be allowed to see the judgement ?\n2. To be referred to the Reporter or not ?\n3. Whether the judgement should be reported in the Digest ?\n\nM.M.KUMAR, J.\n<\/pre>\n
             The revenue has approached this Court by filing the instant<\/p>\n
appeal under Section 35 G of the Central Excise Act, 1944 challenging<\/p>\n
order dated 29.6.2005 ( Annexure A.3) passed by the Custom, Excise and<\/p>\n
Service Tax Appellate Tribunal, New Delhi (for brevity ‘the Tribunal’)<\/p>\n
claiming that question of law would emerge from the Final Order of the<\/p>\n
Tribunal passed in appeal No. ST\/37\/04. In para 1(viii), the question of law<\/p>\n
has been raised and the appeal was admitted on the aforesaid question<\/p>\n
which reads thus:\n<\/p>\n
             ” Whether a person (agent) who has entered into an agreement<\/p>\n
             with principal (owner) for handling and distribution of the<\/p>\n
             products of the principal and entrusted with the job of<\/p>\n
             receiving, storing and distributing the products of the principal
\n CEA No.34 of 2006                    2<\/span><\/p>\n
            to his authorised stockists and distributing centers is liable to<\/p>\n
            pay Service Tax under the category of ‘Clearing and forwarding<\/p>\n
            Agent” when no clearing activity from the manufacturer’s<\/p>\n
            (Principal) premises is directly undertaken by the agent or<\/p>\n
            Service Tax is leviable under the category “Clearing and<\/p>\n
            forwarding” only if an agent renders both clearing forwarding<\/p>\n
            services.”\n<\/p><\/blockquote>\n
            Brief facts of the case may first be noticed. The assessee-<\/p>\n<\/blockquote>\n
respondent is holding registration certificate in form ST 2 for payment of<\/p>\n
Service Tax as ‘clearing and forwarding agent’. Under Section 70 of the<\/p>\n
Finance Act, 1994 every person liable to pay service tax is required to<\/p>\n
furnish to the proper officer of Central Excise a return in the form of ST 3.<\/p>\n
As per amended rule 7(1) of Service Tax Rules, 1994 the return is to be<\/p>\n
filed on half yearly basis. The assessee- respondent entered into an<\/p>\n
agreement with M\/s Cipla for handling and distribution of their products<\/p>\n
and were entrusted with the job of receiving, storing and distributing Cipla<\/p>\n
products to their authorised stockists and distributing centres. For the<\/p>\n
service so rendered, the assessee- respondent was entitled for commission<\/p>\n
based on agreed percentage of sales figures and also for reimbursement of<\/p>\n
recurring expenses. The assessee- respondent failed to submit the half<\/p>\n
yearly return for the period ending 31.3.2001 therefore a show cause notice<\/p>\n
dated 15.6.2001 was issued by the Deputy Commissioner, Ambala Division<\/p>\n
as to why penalty be not imposed upon them under Section 77 of the<\/p>\n
Finance Act,1994 for contravention of Section 70. A penalty of Rs. 1000\/-<\/p>\n
was imposed and the assessee- respondent was directed to pay service tax<\/p>\n
on the taxable service rendered by them alongwith interest and to file the
\n CEA No.34 of 2006                     3<\/span><\/p>\n
return in form ST 3 for the half year ending 31.3.2001 vide order- in-<\/p>\n
original dated 30.10.2002 (A.1). The assessee- respondent preferred an<\/p>\n
appeal before the Commissioner (Appeals) but the same was rejected vide<\/p>\n
order dated 8.9.2003 ( A.2) by holding that assessee- respondent has been<\/p>\n
correctly treated as “C&F agent”.\n<\/p>\n
            The assessee- respondent preferred further appeal and the<\/p>\n
Tribunal allowed the appeal by setting aside the Order in Original by<\/p>\n
observing that taxable service in the instant case is ” any service provided to<\/p>\n
a client by a clearing and forwarding agent in relation to clearing and<\/p>\n
forwarding operation in any manner. The Tribunal further observed that in<\/p>\n
order to attract the levy, the service must be in relation to clearing and<\/p>\n
forwarding agents limited to “clearing and forwarding operations”. With<\/p>\n
regard to Board’s circular the Tribunal has observed that when a C&F agent<\/p>\n
carries out both clearing and forwarding, the levy would be            attracted<\/p>\n
whereas in the instant case the assessee- respondent did not attend to the<\/p>\n
clearing of medicines; consignment were cleared from the factory by the<\/p>\n
manufacturer and delivered to the premises of assessee- respondent and as<\/p>\n
there was no clearing by the assessee- respondent therefore that service<\/p>\n
rendered did not satisfy the requirement of clearing and forwarding.<\/p>\n
              The Tribunal while placing reliance on sub clause (j) of<\/p>\n
Section 65(105) of the Finance Act, 1994 has held that levy of service tax is<\/p>\n
attracted in respect of service rendered ‘in relation to clearing and<\/p>\n
forwarding operations’. According to the Tribunal the definition is patent in<\/p>\n
its meaning that all services rendered by the clearing and forwarding agent<\/p>\n
were not within the scope of the levy of service tax which is limited to<\/p>\n
clearing and forwarding operations. It has also placed reliance on the
\n CEA No.34 of 2006                       4<\/span><\/p>\n
circular dated 20.4.2002 issued by the Central Board of Excise and<\/p>\n
Customs, New Delhi being circular No. 2\/1\/2002-ST dt 20.4.2002<\/p>\n
F.No.137\/04\/.2002-CX.4 It interpreted para 10 of the circular which reads<\/p>\n
thus:\n<\/p>\n
              ” The matter has been examined. Normally, a C&F agent<\/p>\n
              receives goods from the factories or premises of the Principal<\/p>\n
              or his agents, stores these goods, dispatches these goods as per<\/p>\n
              orders received from the Principal or owner, arranges transport<\/p>\n
              etc. for the purpose and prepares invoices on behalf of the<\/p>\n
              Principal. For this service, the C&F agents receives<\/p>\n
              commissions on the basis of agreed terms. Therefore, an<\/p>\n
              essential characteristic of any services, to fall in the category of<\/p>\n
              C&F agent, is that the relationship between the service provider<\/p>\n
              and receiver should be in the nature of principal (owner) and<\/p>\n
              agent. The C &F agent carries out all activities in respect of<\/p>\n
              goods right from stage of their clearance from the premises of<\/p>\n
              the principal to its storage and deliver to the customers.”<\/p><\/blockquote>\n
              (emphasis added)<\/p>\n
        On the basis of the afore-mentioned para, the Tribunal concluded that<\/p>\n
even the circular clarified that levy would be attracted only when clearing<\/p>\n
and forwarding agent carries out both clearing and forwarding operations.<\/p>\n
It referred to the terms of the agreement showing that the dealer only<\/p>\n
attended to the clearing of the medicines manufactured by CIPLA. The<\/p>\n
consignment of medicines are cleared by the manufacturer and delivered to<\/p>\n
the dealer at his premises. After recording the aforesaid finding, the<\/p>\n
Tribunal proceeded to hold that once there is no clearing activity taken by
\n CEA No.34 of 2006                     5<\/span><\/p>\n
the dealer therefore the service rendered by him would not satisfy the<\/p>\n
requirement of clearing and forwarding agent and consequently it set aside<\/p>\n
the demand. It also followed the earlier view taken by the Tribunal in the<\/p>\n
case M\/s Mahavir Generics v. Commissioner of Central Excise, Banglore<\/a><\/p>\n
2004(170) ELT 78 (Tribunal). It is appropriate to notice that in Mahavir<\/p>\n
Generics case, (supra) Delhi Bench of the Tribunal has taken the view that<\/p>\n
the agreement between the dealer and the company clearly showed that<\/p>\n
dealer was not acting as a clearing and forwarding agent then services<\/p>\n
rendered by the dealer could not be treated as one to a client by the clearing<\/p>\n
and forwarding agent in clearing and forwarding operations in any manner.<\/p>\n
Therefore the service cannot be taxed. The tax liability in relation to service<\/p>\n
tax as per the scheme of 1994 Act is attached to the taxable service.<\/p>\n
Consequently the Tribunal held that so long as the dealer is not providing<\/p>\n
taxable service he cannot be brought under the net of service tax.<\/p>\n
            At the outset, we asked Mr. Gurpreet Singh, learned counsel<\/p>\n
appearing for the revenue about the status of the decision rendered by the<\/p>\n
Tribunal in Mahavir Generics case (supra) and whether revenue has<\/p>\n
accepted the same or has appealed against that decision. Mr. Gurpreet Singh<\/p>\n
could not disagree that the decision has attained finality and no appeal has<\/p>\n
been filed by the revenue.\n<\/p>\n
            However, he has argued that the view taken by the Delhi Bench<\/p>\n
of the Tribunal does not hold good in view of the larger Bench decision<\/p>\n
taken in the case of Medpro Pharma Pvt. Ltd. v. Commissioner of Central<\/p>\n
Excise, Chenai 2006(3) STR 355 (Tribunal). Learned counsel has submitted<\/p>\n
that perusal of the aforesaid judgement rendered by the larger Bench of the<\/p>\n
Tribunal would show that clearing and forwarding operations cannot be<\/p>\n
dissected into clearing and forwarding. Indeed such operations would fall in
\n CEA No.34 of 2006                    6<\/span><\/p>\n
the common category and hence all or any of the services of that category<\/p>\n
would attract the imposition of service tax as per the provisions of sub<\/p>\n
section (j) of Section 65(105) of the Act. The view of the larger Bench is<\/p>\n
discernible from paras 32,33,34 and 35 which reads thus:<\/p>\n
            ” 32. While arriving at this conclusion, we also go by the trade<\/p>\n
            understanding based on sheer common sense, which is often<\/p>\n
            common. Because a buyer buys only rice and not wheat in a<\/p>\n
            grocery shop, which claims to sell “wheat and rice”, the shop<\/p>\n
            cannot use to be a shop selling “wheat and rice”. In the same<\/p>\n
            way, rendering only “forwarding” service cannot make the<\/p>\n
            appellant cease to be “Clearing and Forwarding Agent”, so as<\/p>\n
            to save him from the tax. Some customers may want only<\/p>\n
            clearing operations, while some forwarding and others both.<\/p>\n
            The expression “clearing and forwarding operations” is a<\/p>\n
            compendious expression of nature of services offered any of<\/p>\n
            which will bring the service providers in the tax net of this<\/p>\n
            category. Moreover, in the process of forwarding operations-<\/p>\n
            clearance stages may arise such as at octroi posts or subsequent<\/p>\n
            transits.\n<\/p><\/blockquote>\n
            33.We, do agree that it is the context in which the word “and”:<\/p>\n
              is positioned, being sandwiched between the words<\/p>\n
              “clearing” and forwarding” has to be looked into, while<\/p>\n
              interpreting the meaning. Like the legendary Trishanku, the<\/p>\n
              word “and”          is dangling between “clearing” and<\/p>\n
              “forwarding”- neither divorcing from the Heavens, nor from<\/p>\n
              the Earth. In such a positioning, it is not possible to
\n CEA No.34 of 2006                      7<\/span><\/p>\n
              segregate the holistic concept of “clearing and forwarding”<\/p>\n
              into divisible activities, either or both of which can be<\/p>\n
              provided for answering the customers needs.\n<\/p><\/blockquote>\n
            34. It has also been argued before us at length that whenever<\/p>\n
              any ambiguity exists, the decision should be in favour of the<\/p>\n
              asseessee. Thanks to the competent assistance available from<\/p>\n
              the rival parties, the expression “C&F Operations” appears<\/p>\n
              no longer esoteric. Hence, there is no case to extend any<\/p>\n
              benefit of doubt to the assessee.\n<\/p><\/blockquote>\n
            35. In view of the above discussion and findings, we hold that<\/p>\n
              the “C&F Operations” cannot be dissected into “Clearing”<\/p>\n
              and “Forwarding” as they fall in the common category and<\/p>\n
              hence all or any of the services of that category will be<\/p>\n
              services provided by a ” C & F Agent”, connected with<\/p>\n
              “C&F Operations”: and would attract levy of service tax<\/p>\n
              under Section 65(23). Question No.1 referred to us is<\/p>\n
              accordingly answered in the affirmative and the question<\/p>\n
              no.2 in the negative.”<\/p><\/blockquote>\n
            Mr. A.R.Madhav Rao, learned counsel for the dealer, has<\/p>\n
however vehemently argued that once there are numerous and different<\/p>\n
categories carved out by various entries made in the statute for the purpose<\/p>\n
of imposition of service tax then to expand the entry by the process of<\/p>\n
interpretation by stretching the meaning of expression ‘clearing and<\/p>\n
forwarding’ would be doing violence to the plain language of the statute. In<\/p>\n
that regard reliance has been placed on the service known as business<\/p>\n
auxiliary services covered by Section 65(19) so as to cover some of those
\n CEA No.34 of 2006                      8<\/span><\/p>\n
services which are not otherwise covered. Mr. Rao has also argued that the<\/p>\n
expression ‘and’ has not been used as disjunctive and it has necessarily to<\/p>\n
be given its usual general meaning as it has been used as a conjunction<\/p>\n
connecting words or phrases expressing the idea that later is to be added to<\/p>\n
or taken alongwith the first. He has emphasised that the expression ‘clearing’<\/p>\n
connotes entirely a different service than the expression ‘forwarding’ and<\/p>\n
one person may not necessarily be able to render both the services. He has<\/p>\n
maintained that the aforesaid emphasis should be accepted especially when<\/p>\n
the Board has issued a circular. He has further submitted that in any case the<\/p>\n
revenue has accepted the view of the Tribunal in the case of M\/s Mahavir<\/p>\n
Generics (supra) then the filing of the present appeal would be an unholy act<\/p>\n
on the part of the revenue.\n<\/p>\n
            After hearing learned counsel for the parties, perusing the<\/p>\n
record and various provisions of the statute\/ circular we find that for<\/p>\n
answering the question it would be necessary to first read the provisions of<\/p>\n
clause (j) of Section 65(105) of the Act which reads thus:<\/p>\n
            ” 65. Definitions<\/p>\n
            In this Chapter, unless the context otherwise requires.-<\/p>\n<\/blockquote>\n
            (1)to (104) xx       xx    xx    xx    xx<\/p>\n
                  (105) “taxable service” means any service provided or to be<\/p>\n
                  provided.-\n<\/p><\/blockquote>\n
            (a) to (g)     xx    xx    xx    xx<\/p>\n<\/blockquote>\n
            (h) to a client, by a custom house agent in relation to the entry<\/p>\n
            or departure of conveyances or the import or export of goods.    t a<\/p>\n<\/blockquote>\n
            (i)      xx    xx    xx    xx<\/p>\n<\/blockquote>\n
            (j) to a client, by a clearing and forwarding agent in relation to<\/p>\n
            clearing and forwarding operations, in any manner;”<\/p><\/blockquote>\n
\n CEA No.34 of 2006                     9<\/span><\/p>\n
      A perusal of the aforesaid Section shows that taxable service has been<\/p>\n
defined to mean any service provided or to be provided to a client by a<\/p>\n
‘clearing and forwarding agent in relation to clearing and forwarding<\/p>\n
operations in any manner’. If the clearing operation are separated from<\/p>\n
forwarding operations, the levy of tax would not be attracted if it only<\/p>\n
involves one of the two activities.\n<\/p>\n
            The question which falls for consideration is whether word<\/p>\n
‘and’ used after the word ‘clearing’ but before the word ‘forwarding’ at two<\/p>\n
places in clause (j) be considered in a conjunctive sense or dis-injunctive<\/p>\n
sense. It appears to be fairly well settled that the context and intention of<\/p>\n
legislature are the guiding principles. In that regard reliance may be placed<\/p>\n
on the judgement of Hon’ble the Supreme Court in the case of Mazagaon<\/p>\n
Dock Ltd. V CIT (1958) 34 ITR 368. By necessary intendment the<\/p>\n
expression ‘a clearing and forwarding agent in relation to clearing and<\/p>\n
forwarding operations, in any manner’       contemplates only one person<\/p>\n
rendering service as ‘clearing and forwarding agent’ in relation to ‘clearing<\/p>\n
and forwarding operations’. To say that if, one person has rendered service<\/p>\n
as ‘forwarding agent’ without rendering any service as ‘clearing agent’ and<\/p>\n
he be deemed to have rendered both services would amount to replacing the<\/p>\n
conjunctive ‘and’ by a disjunctive which is not possible. The counsel for the<\/p>\n
revenue has not been able to bring on record any material to show the word<\/p>\n
‘and’ should be construed as disjunctive. He has not shown any ‘trade<\/p>\n
practice’ which may lead to a necessary inference that service of one kind<\/p>\n
rendered by one is invariably considered to comprise both. No argument has<\/p>\n
been advanced before us by him to canvass that the legislature intention is<\/p>\n
discernible from the scheme of the statute or from any other relevant
\n CEA No.34 of 2006                     10<\/span><\/p>\n
material. Therefore the word ‘and’ should be understood in a conjunctive<\/p>\n
sense. (See Maharaja Sir Pateshwari Prasad Singh v. State of U.P.(1963) 50<\/p>\n
ITR 731). In these circumstances if we read the word ‘and’ as ‘or’ then it<\/p>\n
would amount to doing violence to the simple language used by Legislature<\/p>\n
which cannot be imputed ignorance of English language. In that regard we<\/p>\n
place reliance on the judgement of Hon’ble the Supreme Court rendered in<\/p>\n
the case of Inayat Ali Khan v. State of U.P.<\/a> (1971) 2 SCC 31 (Para 5) and<\/p>\n
para 6 of the judgement of Hon’ble the Supreme Court rendered in the case<\/p>\n
of Ape Belliss India Ltd v. Union of India<\/a> (2001) 132 ELT 8. The<\/p>\n
observations of their Lordship reads thus :\n<\/p>\n
            “6…….. A plain reading of the Section (sic Tariff Public Notice)<\/p>\n
            clearly shows, as contended by Mr. Bhatt, that for an alloy steel<\/p>\n
            to be considered as stainless steel, it will have to satisfy two<\/p>\n
            conditions i.e. The alloy steel should be known in the trade as<\/p>\n
            stainless steel and further, it should contain 11% chromium as a<\/p>\n
            component of the allow steel. This is clear from the use of the<\/p>\n
            word “and”. If the intention of the trade notice was to treat the<\/p>\n
            two types of alloy steels as stainless steel, then it would have<\/p>\n
            been made clear by using the word “of” instead of the word<\/p>\n
            “and”.”<\/p><\/blockquote>\n
            We are further of the view that the circulars issued by the<\/p>\n
Board are binding and meant for adoption for the purposes of bringing<\/p>\n
uniformity. In that regard reliance may be placed on the judgements of<\/p>\n
Hon’ble the Supreme Court in the cases of Ranadey Micronutrients v.<\/p>\n
Collector of Central Excise<\/a> 1996(87) ELT 19 (SC) and Paper Products Ltd.<\/p>\n
v. Commissioner of Central Excise<\/a> (1999) 7 SCC 84. If the aforesaid<\/p>\n
principle is applied to the facts of the present case there does not remain any
\n CEA No.34 of 2006                    11<\/span><\/p>\n
doubt that the circular issued by the Board is to be considered as binding<\/p>\n
and cannot be deviated even by the department. On that account also the<\/p>\n
expression ‘clearing and forwarding agent’ have to be interpreted in the light<\/p>\n
of the circular.\n<\/p>\n
             The view taken by the Tribunal in M\/s Mahavir Generics’s case<\/p>\n
(supra) has been accepted by the revenue as no appeal has been filed.<\/p>\n
Moreover we are not able to persuade ourselves to accept the view taken by<\/p>\n
the larger Bench of the Tribunal in the case of Medpro Pharma Pvt. Ltd.<\/p>\n
(supra) which has been fascinated by musical notes of symphony as is<\/p>\n
evident from the following paras:\n<\/p>\n
             ” 31.We have heard both sides and perused the record. On a<\/p>\n
             fresh look at the whole issue and after taking into account the<\/p>\n
             various newfangled arguments and nascent lines of thinking,<\/p>\n
             unwrapping before us, as discussed in the fore-going<\/p>\n
             paragraphs, we find ourselves in a better position to appreciate<\/p>\n
             the wisdom in the words of Jules Romains when he said “What<\/p>\n
             I say below represents only conclusions with which I would<\/p>\n
             identify myself, if I were obliged to stop thinking today”. The<\/p>\n
             underlying wisdom in these words has greatly encouraged us in<\/p>\n
             this inquest to appreciate the emerging facts and sceniario in a<\/p>\n
             proper perspective. Crucial key-word the definition of taxable<\/p>\n
             services, namely “C&F Operations” needs to be viewed afresh<\/p>\n
             in this scenario. The whole “operations” involved in “C&F<\/p>\n
             operations” now remind us of an orchestra, performing a<\/p>\n
             western classical symphony. It reminds us of a connoisseur’s<\/p>\n
             experience of harmony in western classical music. While<\/p>\n
             listening to Mahler’s 9th symphony, one does not listen to an
\n CEA No.34 of 2006                   12<\/span><\/p>\n
            individual violin or a trumpet, but the harmony emanating<\/p>\n
            from many different seemingly unrelated instruments. In the<\/p>\n
            same way, a C&F Agent’s functions consisting of seemingly<\/p>\n
            unrelated tasks are well orchestrated. This view of ours is<\/p>\n
            strengthened by various references including the Report of<\/p>\n
            United Nations Economic Commission for Africa referred to by<\/p>\n
            us in the preceding paragraphs all revealing in no uncertain<\/p>\n
            terms that the freight forwarders are known variously as<\/p>\n
            clearing agent, shipping forwarding agent etc. We are,<\/p>\n
            therefore,of the view that even if one segment of activities is<\/p>\n
            not demonstrated to be performed, it cannot be held that the<\/p>\n
            appellants were not engaged in taxable service. Due to their<\/p>\n
            orchestrated nature of work, such isolated activity can also be<\/p>\n
            covered under “C&F Operations”. Merely, because the bassoon<\/p>\n
            was not played in one of the movements of a symphony, it does<\/p>\n
            not cease to be otherwise a part of the orchestra. While forming<\/p>\n
            this view, we have certainly not overlooked the fact that while<\/p>\n
            music can be sometimes taxing, a tax can never be musical.<\/p>\n<\/blockquote>\n
            32.While arriving at this conclusion, we also go by the trade<\/p>\n
            understanding based on sheer common sense, which is often<\/p>\n
            uncommon. Because a buyer buys only rice and not wheat in a<\/p>\n
            grocery shop, which claims to sell “wheat and rice”, the shop<\/p>\n
            cannot cease to be a shop selling “wheat and rice”. In the same<\/p>\n
            way, rendering only “forwarding” service cannot make the<\/p>\n
            appellant ceases to be “Clearing and Forwarding Agent”, so as<\/p>\n
            to save him from the tax. Some customers may want only
\n CEA No.34 of 2006                      13<\/span><\/p>\n
              clearing operations, while some forwarding, and others both.<\/p>\n
              The expression “clearing and forwarding operations” is a<\/p>\n
              compendious expression of nature of services offered any of<\/p>\n
              which will bring the service providers in the tax net of this<\/p>\n
              category. Moreover, in the process of forwarding operations-<\/p>\n
              clearance stages may arise such as at octroi posts or subsequent<\/p>\n
              transits.\n<\/p><\/blockquote>\n
              33. We , do agree that it is the context in which the word “and”<\/p>\n
              is positioned, being sandwiched between the words “clearing”<\/p>\n
              and “forwarding” has to be looked into while interpreting the<\/p>\n
              meaning. Like the legendary Trishanku, the word “and” is<\/p>\n
              dangling between “clearing” and “forwarding”- neither<\/p>\n
              divorcing from the Heavens, nor from the Earth. In such a<\/p>\n
              positioning, it is not possible to segregate the holistic concept<\/p>\n
              of ‘clearing and forwarding” into divisible activities, either or<\/p>\n
              both of which can be provided for answering the customers’<\/p>\n
              needs.”<\/p><\/blockquote>\n
      We have not been able to understand with utmost respect to the<\/p>\n
Tribunal as to what is ‘Orchestrated nature of work’ involved in the present<\/p>\n
transaction. The dealer in the present case as per the arrangements reached<\/p>\n
between the parties has to receive goods which are already got ‘cleared’ by<\/p>\n
the manufacturer. The dealer is to store those goods and forward to the<\/p>\n
buyer of the goods as per direction received. In that regard the findings of<\/p>\n
the Tribunal in the instant case is patently clear when it observed as under<\/p>\n
in para 6 :\n<\/p>\n
              “It is clear from the terms of the agreement that appellant herein
\n CEA No.34 of 2006                     14<\/span><\/p>\n
            does not attend to the clearing of the medicines manufactured<\/p>\n
            by Cipla. Consignments of medicines are cleared from the<\/p>\n
            factory by the manufacturer and delivered to the appellant at his<\/p>\n
            premises. In this factual situation, it has to be held that there is<\/p>\n
            no Clearing by the appellant and for that reason, the service<\/p>\n
            rendered by the appellant does not satisfy the requirement of<\/p>\n
            clearing and forwarding. We, therefore, are of the view that the<\/p>\n
            demand is not sustainable. To the same effect is our earlier<\/p>\n
            decision in the case of M\/s Mahavir Generics”<\/p><\/blockquote>\n
      The example of ‘wheat and rice’ grocery shop is obviously wholly<\/p>\n
mis-appropriate and does not fit in the context. We are also not in agreement<\/p>\n
with the interpretation of word ‘and’ which has already been dilated upon by<\/p>\n
us.\n<\/p>\n
            As a sequel to the above discussion, the question of law raised<\/p>\n
is decided against the revenue and in favour of the assessee.<\/p>\n
\n\n\n\n                                             (M.M.Kumar)\n                                               Judge\n\n\n\n                                             (H.S. Bhalla )\n24.2.2009                                           Judge\n\nokg\n <\/pre>\n","protected":false},"excerpt":{"rendered":"
Punjab-Haryana High Court Commissioner Of Central Excise vs M\/S Kulcip Medicines (P) Ltd on 24 February, 2009 CEA No.34 of 2006 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH. CEA No. 34 of 2006 Date of decision 24 .2.2009 Commissioner of Central Excise, Panchkula …Appellant Versus M\/s Kulcip Medicines (P) Ltd. … […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_lmt_disableupdate":"","_lmt_disable":"","_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[8,28],"tags":[],"class_list":["post-35540","post","type-post","status-publish","format-standard","hentry","category-high-court","category-punjab-haryana-high-court"],"yoast_head":"\nCommissioner Of Central Excise vs M\/S Kulcip Medicines (P) Ltd on 24 February, 2009 - Free Judgements of Supreme Court & High Court | Legal India<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.legalindia.com\/judgments\/commissioner-of-central-excise-vs-ms-kulcip-medicines-p-ltd-on-24-february-2009\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Commissioner Of Central Excise vs M\/S Kulcip Medicines (P) Ltd on 24 February, 2009 - 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