2015 (11) TMI 970 - AT - Service Tax

Classification of services - Cargo Handling Services or manpower recruitment services - Held that - Respondent were registered with the department and were paying service tax for the same service under Manpower Supply Agency w.e.f. 16.06.2005. The Revenue s case is prior to that date, they should be charged service tax under Cargo Handling Services . - Activities are done automatically by machinery and conveyor owned by the cement manufacturer. The manpower supplied by the respondent is for mainly supervising and supplementing the mechanised packing and loading - Revenue has not given any reason as to why the impugned services were classifiable under Cargo Handling Services before 16.06.2005 and as manpower recruitment from 16.06.2005 - The admitted fact is that the services remain same and there is no reason for different service tax treatment for different period. Considering the detailed discussions and findings in the impugned order we find no reason to interfere with the same - Decided against Revenue.

Summary

Issues: Classification of services for service tax liability under "Cargo Handling Services" or "Manpower Recruitment Services" for the period before and after 16.06.2005.

In this case, the Revenue appealed against the Order-in-appeal of the Commissioner (Appeals) regarding the service tax liability of the respondent for providing loading/unloading services of cement. The Revenue contended that the respondent should be taxed under "Cargo Handling Services" for the period before 16.06.2005. The Commissioner (Appeals) had set aside the original order and ruled in favor of the respondent. The Revenue argued that manual labor was involved in the loading/unloading process, indicating it falls under "Cargo Handling Services." However, the respondent claimed that their laborers were mainly supervising and assisting in the mechanized process, not directly involved in loading/unloading. The Tribunal examined the case and found that the activities performed by the respondent did not qualify as "Cargo Handling Services" based on the automated nature of the cement plant and the laborers' supervisory role. The Tribunal agreed with the Commissioner (Appeals) and dismissed the Revenue's appeal, stating that the services remained the same before and after 16.06.2005, thus no change in tax treatment was warranted. The Tribunal upheld the decision, emphasizing the lack of sustainable grounds for the Revenue's appeal.

In conclusion, the judgment resolved the issue of service tax classification for the respondent's services, determining that they did not fall under "Cargo Handling Services" but rather under "Manpower Recruitment Services." The decision was based on the automated nature of the cement plant and the supervisory role of the laborers provided by the respondent. The Tribunal found no valid reason to overturn the Commissioner (Appeals) decision and dismissed the Revenue's appeal, also disposing of the respondent's cross-objection.