2016 (12) TMI 1713 - AT - Service Tax

Liability of service tax - activities of chilling the milk collected by the Cooperative Societies on behalf of the Jaipur Dairy - whether such activity amounts to manufacture or would fall under the category of Business Auxiliary Service - Held hat - Tribunal in the case of Vinayak Industries 2016 (6) TMI 1072 - CESTAT NEW DELHI held that chilling of milk makes it possible to market/sell it to the consumers located at considerable distances - As such holding the process as amounting to manufacture it was held that no service tax levy under the category of BAS is chargeable on such process - service tax not levied - appeal allowed - decided in favor of appellant.

Summary

Issues:
Tax liability for chilling milk activities under "Business Auxiliary Service" category.

Analysis:
The judgment pertains to an appeal against a Commissioner's order confirming a service tax liability of &8377; 6,78,830/- on the appellant for chilling milk collected by Cooperative Societies for Jaipur Dairy. The Tribunal considered the case in light of a previous ruling in Vinayak Industries, where it was held that chilling milk renders it marketable, amounting to manufacture under Chapter-4 of the Central Excise Tariff. As chilling enables selling to distant consumers, it was concluded that no service tax under "BAS" is applicable. Consequently, the impugned order was set aside, and the appeal was allowed.