The charges collected by co-loaders from courier agency, are ultimately recovered by the courier agency

Indian Service Tax

Clarifications

Co-loaders

[TN No. 138/96, dated 27-11-1996 of the Cochin Commissionerate]

7. Some Courier Agencies utilise the services of another company known as "co-loaders" for transit movement of goods, articles etc. The charges collected by co-loaders from courier agency, are ultimately recovered by the courier agency from the customers. Such charges are also to be included in the gross amount of taxable services.

8. In respect of door to door transportation of time sensitive documents, goods or articles, the gross amount charged by the courier agency from the customers would be the gross amount for taxable service.

9. Service Tax is chargeable on the documents, goods or articles sent abroad. However in respect of documents, goods, articles etc. received from abroad and delivered to a customer in India, no service tax is payable.

10. The courier agencies who undertake comprehensive business and provide integrated transportation, warehousing, packing, inventory management etc. the charges collected for such facilities are also to be included in the gross amount of taxable service.

Registration & Payment of S.T.

Cir. No. 21/1/97-ST, Date: 27/1/1997

Sub: Service Tax - Registration/Collection of Service Tax from Courier agencies - Revised procedure

Attention of the trade is invited to para 22 of Trade Notice No. 82/96­-Service Tax, dated 1-11-1996, according to which where the bills are raised by regional office for all its branches under that region, the regional office alone may be registered and not the individual office which do not raise the bills. Similarly, if the head office of the courier agencies has a centralised billing system in respect of services rendered to clients from its branches, the head office alone may be registered. In case the day to day billing is not centralised at the regional or head office and there is merely a reconciliation of accounts and business done from each of the branch office, each office has to be registered and pay the service tax. A number of courier agencies have represented that owing to peculiar nature of the industry, i.e., the location of small branch offices at remote places, the lack of manpower and the lack of knowledge about taxation and accounting, difficulty is being faced by them with regard to registration of each of the branch office and deposit of service tax and completion of assessment formalities.

2. The matter has been examined.It has been decided by the Board that to overcome the genuine problems faced by the courier agencies they may be allowed to register the regional offices in relaxation of para 22 of the trade notice referred to above . The following procedure shall have to be followed by the courier agencies for availing this mode of registration and payment of service tax. Once this option is given by one regional office of a courier agency , the same option has to be given by all regional offices of that courier agency.

• The courier agency who desires to avail this system of registration , shall have to tender the option in writing to the Assistant Commissioner (Service Tax Cell) of the Central Excise Commissionerates under whose jurisdiction regional office falls (hereinafter referred to as focal point Commissionerate).

• The details such as the location and address of all branch offices falling under that region should be enclosed in duplicate with written option.

• An undertaking has to be given by the Regional Office to the effect that in case of credit transactions ,the sevice tax shall be paid by the regional office by the 15^thof the month following the month in which the credit bills are raised whether or not the amounts are realized from the customer.

• On receipt of the option the Assistant Commissioner of Central Excise shall endorse the option letter permitting the regional office to register with the focal point Central excise Commissionerate. The original copy will be returned to the Regional Office and the duplicate shall be kept for record.

  In most of the cases, the distribution of regions may not coincide with the jurisdiction of the Commissionerates. To avoid the overlapping of jurisdiction in the matter of registration of the courier agencies, the Assistant Commissioner of focal point Central Excise Commissionerate shall endorse a copy of ST -2 alongwith the copy of the option permitting for registration by regional office to other Central Excise Commissionerates under which other branch offices fall.

• The regional office shall allocate the distinguishable running S. Nos. to the Air way bills issued to each branch office.

• The branch offices in case of cash or walk-in-customers, shall issue a separate bill along with the airway bill specifying the service tax separately which may not be the practice till date.

• The branch offices may send a monthly sales report to the regional office or the regional office may prepare a monthly statement on the basis of daily sales report sent by the branch offices. This monthly statement prepared branch-wise by the regional office should enclose the air way bills as well as the cash/credit bills issued to all customers.

• The regional office shall consolidate the monthly statements prepared branch-wise and shall prepare a consolidated monthly statement of all sales for that region.

• The regional office shall attach with the ST-3-return filed with the focal point Central Excise Commissionerate the branch-wise monthly statements alongwith the enclosures as mentioned in para (vii) and the consolidated monthly statements as mentioned in para (viii) relating to the quarter.

• For all cash transactions made during a month the service tax should be deposited by the regional office by 15th of the following month in the designated bank. For all credit transactions made during the month, the regional office shall deposit the service tax by the 15th of the month following the month in which the credit bills are raised in the designated bank.

• The assessment may be done by the focal point assessing officer after satisfying himself about the realisation of service tax in respect of all transactions made through the branch offices falling under the region.

• In case of doubt, the Central Excise Commissionerate having jurisdiction over the branch, to which a copy of ST - 2 has already been endorsed by the focal point Central Excise Commissionerate shall make a reference to the focal point Commissionerate calling for copies of assessed ST-3 return alongwith the enclosures for reconciling the Airway bills, cash/credit bills issued by the branch office with payment particulars of service tax by the Regional Office. Similarly, the focal point Commissionerate, in case of doubt regarding a branch falling outside the territorial jurisdiction, shall refer the matter to the Central Excise Commissionerate having jurisdiction over that branch to verify the bills for purpose of reconciliation.

The Courier agencies who do not opt for the procedure as set out in Para 2 above shall be covered under Para 22 ofT.N.No. 82/96, dated 1/11/1996 as mentioned in Para 1.

Notification

Exemption to Diplomatic Missions

N.B.: For full text of Notification No. 44/98-ST, dated 22/01/1998 see Under 'Advertising Agency'.