STEAMER AGENT
Date of Introduction: 15.06.1997 vide Notification No.17/97ST dt.06.06.1997.
Definition:
“Steamer Agent” means any person who undertakes, either directly or indirectly.
(a) to perform, any service in connection with the ship’ Husbandry or dispatch including the rendering of administrative work related thereto; or
(b) to book, advertise or canvass for cargo for or on behalf of a shipping line; or
(c) to provide container feeder services for or on behalf of a shipping line; (Section 65(68)of Finance Act,1994 as amended)
Taxable event & Scope of service:
Taxable service means any service provided to a shipping line, by a steamer agent in relation to a ship’s Husbandry or dispatch or any administrative work related thereto as well as the booking, advertising or canvassing of cargo, including container feeder services.
(Section 65(72) (i) of Finance Act, 1994 as amended)
Seaport offices of the steamer agent, which are raising the bill to the shipping lines, should be registered for Service Tax purpose. The branch offices in ICDs, which are just sales offices and do not raise any bills to the shipping line, need not be registered. This is for the reason that billing is done by the seaport offices and not the branch offices.
(Ministry’s F.No.B-43/1/97-TRU dt.06.06.1997)
Value of Taxable Service
Value of taxable service shall be the gross amount charged by service provider for such service rendered by him.
(Section 67 of Finance Act, 1994 as amended)
The value of the taxable service in relation to service provided by a steamer agent to a shipping line, shall be the gross amount charged by such agent from the shipping line for services in relation to a ships Husbandry or dispatch or any administrative work related thereto or in relation to the booking, advertising or canvassing of cargo, container feeder services including the commission paid to such agent.
Steamer agents incur various types of expenses on behalf of the shipping line such as pilottage and berth hire charges, Indian Coast light dues paid to the port authorities, cargo expenses paid to port authorities and transporters such as CONCOR/railways, private transporters, chartered accountants fee, income tax, brokerage paid on export cargo, ship handling expenses paid to stevedoring agents. For all the above charges the Steamer agent is ordinarily reimbursed by the shipping line.
Further, the steamer agent bills the principals i.e. the shipping line, for two types of service charges. One is called the husbandry fee, which they charge for a ships husbandry. The second is the agency commission, which is paid by the shipping line on the import and export cargo. These commissions are usually paid as a percentage of the net ocean freight (basic freight), which is clearly indicated in the agreement, entered into between the steamer agent and shipping line.
It is clarified that in relation to the steamer agent the service charges will constitute the Husbandry fee as well as the agency commission on import/export cargo, other expenses incurred by the steamer agent on behalf of the shipping line shall not be taken into account. (Ministry’s F.No.B43/1/97-TRU dt.06.06.1997)
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