2015 (11) TMI 470 - AT - Service Tax

Demand of service tax - Manpower Recruitment or Supply Agency service - Respondent is engaged in work-wise carrying out lifting and storing of sugar bags - Held that - Impugned order has categorically recorded that the respondent had received an amount towards Hamali charges as a lumpsum value and not for the individual worker wise, who are employed for undertaking the work of lifting and storing of sugar bags in the sugar factory. The entire tenor of the order seems to be that the activity undertaken by the appellant is one of the lumpsum activity. We find that the issue involved in this case is now squarely covered by the judgment of the Hon ble High Court in the case of CCE & ST vs. Godavari Khore Cane Transport Company Pvt. Ltd. - 2015 (3) TMI 483 - BOMBAY HIGH COURT . - issue involved is now squarely covered by the judgement of the Hon ble High Court; accordingly, we hold that the impugned order is correct - Decided in favour of assessee.

Summary

Issues: Service tax liability for the period 16/05/2005 to 31/03/2009 under the category of "Manpower Recruitment or Supply Agency" service.

Analysis:
1. The appeal was filed by the Revenue against the Order-in-Appeal passed by the Commissioner of Central Excise & Customs (Appeals), Aurangabad. Despite the absence of any representation from the respondent, the issue was taken up for disposal.

2. The issue revolved around the service tax liability concerning the work of lifting and storing sugar bags by the respondent. The Revenue argued that the respondent, engaged in work-wise activities, was liable to discharge service tax. The first appellate authority noted that the respondent received a lump sum amount for "Hamali charges" rather than individual worker-wise payments.

3. The judgment of the Hon'ble High Court in a similar case was cited, emphasizing that the services provided were part of a package deal for the supply of essential raw material to the sugar factory. The agreement between the respondent and the principal factory clarified that the nature of work was not the concern of the factory, and the work was done through laborers procured by the respondent.

4. The show cause notice issued by the Revenue in 2008 was deemed unjustified as the package deal in question was not taxable under service tax laws at that time. The amendments in the relevant provisions post-2012 made all services taxable except those in the "negative list." The judgment concluded that the services rendered by the respondent during the relevant period were not taxable.

5. Based on the High Court judgment and the analysis of the service tax provisions applicable during the relevant period, the Tribunal held that the impugned order was correct and legal, without any infirmity. Consequently, the appeal was allowed.

This detailed analysis of the judgment highlights the key arguments, legal interpretations, and conclusions reached by the Tribunal regarding the service tax liability issue under consideration.