E-sell auctions can’t be made taxable as OIDAR services

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CESTAT dismisses Revenue’s appeal, conducting online e-sell auctions for various commodities such as MS/SS Steel etc. an e-commerce trading activity, not taxable as “online information and database access or retrieval services” (OIDAR);

Notes that, assessee is running website through which interested steel manufacturer / trader are making trade, and assessee is buying and selling steel product to various steel manufacturers / traders; Rejects Revenue’s plea that Board Circular dated July 9, 2001 only covers those e-commerce transactions where no charge is paid by surfers for information on sale of goods and services, while in present case, assessee is charging fees from those who wish to access such online information and database;

Observes, buyer of goods is not accessing any information or data online online on assessee’s site but is only interested for sale and purchase of steel products and for such trading, assessee is getting margin from sale and purchase, which activity clearly is e-commerce in respect of steel products; As regards demand under business auxiliary services (BAS), CESTAT observes that assessee claimed benefit of Notification No. 13/2003 until July 9, 2004 (as ‘commission agent’) and thereafter discharged service tax under said category, accordingly service tax is unsustainable  : Mumbai CESTAT

Citation: [TS-345-CESTAT-2017-ST] 

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