2017 (1) TMI 238 - AT - Service Tax

Business auxiliary services - the appellant is primarily engaged in activity related to harvesting of sugarcane and transportation of the same from the agricultural fields of the farmers who grow such cane to the sugar factory; appellant also provides the services all loading or unloading of such sugarcane in the factory for which they paid the Service Tax - whether the services rendered by the appellant or taxable under the category of Business Auxiliary Services or otherwise? Held that - the issue is no more res integra of this Bench in the case of Dnyaneshwar Trust Vs. Commissioner of Central Excise, Mumbai 2014 (1) TMI 90 - CESTAT MUMBAI , where it was held that harvesting and transporting of sugarcane to the factory will not fall under the category of Business Auxiliary Services - demand set aside - appeal allowed - decided in favor of assessee.

Summary

Issues involved: Determination of taxability under 'Business Auxiliary Services' category.

Analysis:
The appeal before the Appellate Tribunal CESTAT Mumbai challenged Order-in-Original No. 10/ST/2012 passed by the Commissioner of Central Excise, Customs & Service Tax, Nashik. The central issue in this case was whether the services provided by the appellant fall under the taxable category of 'Business Auxiliary Services' as per Section 65(19) of the Finance Act, 1994. The appellant's activities primarily involved harvesting sugarcane and transporting it from farmers' fields to a sugar factory, including loading and unloading services for which Service Tax was paid. The department contended that the Service Tax should be recovered under the aforementioned section.

Upon reviewing the records and considering precedents, the Tribunal found that the issue at hand had already been settled in previous cases. Referring to the case of Dnyaneshwar Trust Vs. Commissioner of Central Excise, Mumbai and other similar cases, the Tribunal concluded that the harvesting and transportation of sugarcane to the factory do not fall within the scope of 'Business Auxiliary Services'. Citing the judgment in the Dnyaneshwar Trust case, the Tribunal set aside the impugned order and allowed the appeal. The Tribunal's decision was based on the established legal position that such activities do not attract taxation under the 'Business Auxiliary Services' category.

In the operative part of the order pronounced in open court, the Tribunal allowed the appeal, thereby providing a clear resolution to the issue raised in the case. The decision reaffirmed the legal interpretation regarding the taxability of services related to sugarcane harvesting and transportation, providing clarity and consistency in the application of tax laws in similar cases.