2012 (12) TMI 479 - AT - Service Tax

Manpower Recruitment and Supply Agency services - Waiver of pre-deposit confirmed as Service Tax, Interest and Penalty - Held that - The terms in the contract indicates that the appellant was awarded a contract for functioning or carrying out a particular activity within the cement plant of M/s. Ultra Tech Cement Limited. As that appellant did not appear before the adjudicating authority who in turn did not have a privilege of going through the contract the entire issue needs to be reconsidered by the adjudicating authority - remit the matter back to the adjudicating authority to reconsider the issue afresh after following the principles of natural justice.

Summary

Issues:
Waiver of pre-deposit of confirmed service tax and penalties under Finance Act, 1994 based on Manpower Recruitment and Supply Agency services contract.

Analysis:
The appellant filed a stay petition seeking waiver of pre-deposit of Rs. 44,98,801/- confirmed as service tax and penalties under the Finance Act, 1994. The amounts were confirmed by the adjudicating authority and upheld by the first appellate authority due to the appellant's failure to discharge service tax liability in full for providing Manpower Recruitment and Supply Agency services. The appellant contended that the entire contract with Ultratech Cement Limited was for executing a job based on a lump-sum amount, citing precedents where such contracts were not considered as Manpower Recruitment and Supply Agency services.

The appellant's counsel argued that the adjudicating authority passed an ex-parte order, while the learned Commissioner (Appeals) decided on the matter only during the stay petition. The departmental representative opposed the new argument, stating that the appellant did not raise it before the lower authorities, thus precluding its consideration by the Tribunal.

Upon reviewing the contract and relevant clauses, the Tribunal found that the appellant was contracted to perform a specific activity within the cement plant of Ultratech Cement Limited. Noting that the adjudicating authority did not have the opportunity to review the contract, the Tribunal decided to remit the matter back to the adjudicating authority for reconsideration. The Tribunal emphasized the need for the adjudicating authority to examine the contract terms and the cited judgments to ensure a fair decision following the principles of natural justice.

Consequently, the Tribunal set aside the impugned orders, keeping all issues open without expressing any opinion on the case's merits. The matter was remanded to the adjudicating authority for a fresh review, with the appellant undertaking to cooperate during any personal hearings. The stay petition and appeal were disposed of through remand to the adjudicating authority, allowing for a comprehensive reassessment of the case.