2015 (6) TMI 306 - AT - Service Tax

Classification of service - Manpower supply service or not - Held that - Appellant have carried out various odd jobs during the period in dispute for Ispat Industries Ltd. like, lining, coating, loading and unloading etc. with the aid of her team (other workers). It is further evident from bill of the job done that the same is definitely not classifiable under manpower recruitment and supply agency service. The payment of Service Tax in such facts and circumstances, show that the appellant have got no concept or knowledge of Service Tax and have deposited the same out of fear with interest much prior to the issue of show-cause notice, i.e almost a year. Further, the Counsel for the appellant makes the concession by stating that in the facts and circumstances, the appellant will not be claiming any refund of amount (tax) and interest already deposited. In this view of the matter, the impugned order is set aside and the appeal stands allowed in favour of the appellant. - Tribunal has only seen the sample bills produced before it. Further, the impugned order is also silent as to the material facts. In this view of the matter, I remand the issue limited to re-calculation of the tax, to the adjudicating authority - Decided in favour of assessee.

Issues:
1. Service Tax liability on odd-job services provided by the appellant.
2. Imposition of penalties under various sections of the Act.
3. Appeal against the penalties imposed by the Commissioner (Appeals).
4. Classification of the appellant's activities under manpower recruitment or supply agency service.
5. Rulings relied upon by the appellant for setting aside penalties.
6. Re-calculation of tax liability and refund of any excess amount.

Analysis:

Issue 1: Service Tax liability on odd-job services
The appellant, engaged in odd-job services like supplying labor to a company, was found to be non-compliant with Service Tax regulations. The appellant later obtained registration and paid Service Tax for the services provided. The Revenue issued a show-cause notice demanding unpaid Service Tax, interest, and penalties. The Order-in-Original confirmed the demand and imposed penalties.

Issue 2: Imposition of penalties
Penalties were imposed under various sections of the Act for non-payment of Service Tax, non-filing of returns, and other defaults. The appellant contested the penalties, citing compliance with Section 73(3) and arguing against the harshness of the penalties imposed.

Issue 3: Appeal against penalties
The appellant appealed before the Commissioner (Appeals) challenging the penalties imposed. The Commissioner partially allowed the appeal, setting aside one penalty while confirming others. The appellant further appealed to the Tribunal against the upheld penalties.

Issue 4: Classification of activities
The appellant argued that the activities performed were not classifiable under manpower recruitment or supply agency service. They claimed to have engaged in odd jobs based on area rates or lump-sum payments, not as a recruitment agency. The Tribunal found the activities did not fall under the said classification.

Issue 5: Rulings relied upon
The appellant cited precedents where similar activities were not considered as manpower supply. They relied on tribunal and court judgments to support their argument against the penalties imposed.

Issue 6: Re-calculation and refund
The Tribunal set aside the impugned order, allowing the appeal in favor of the appellant. It remanded the issue for re-calculation of tax liability under the correct classification. All penalties were set aside, and if any amount was found refundable, it was to be refunded without requiring a separate application.

This detailed analysis covers the various issues involved in the legal judgment, providing a comprehensive understanding of the case and its implications.

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