2017 (5) TMI 1203 - AT - Service Tax

Manpower Recruitment or Supply Agency Service - job-work - case of appellant is that they are not a manpower supply agency. They have undertaken job of cutting or packing of footwear, in the premises of the client, as per the instructions of the client - Held that - There is no evidence of supply of manpower with details of number and nature of manpower, duration and other conditionalties for such supply. In absence of such evidence, the simple allegation that the appellant received some amount from the clients for job work and such amount should be taxed under Manpower Recruitment and Supply Agency Service is not sustainable - In absence of any supporting evidence, it is not feasible to contend that the appellants provided taxable service under the category of Manpower Recruitment and Supply Agency Service - demand set aside - appeal allowed - decided in favor of appellant.

Summary

Issues:
Service tax demand for "Manpower Recruitment or Supply Agency Services" under Section 65(68) of the Finance Act, 1994.

Analysis:
The appellant contested the demand, claiming they were not a manpower supply agency but were engaged in job work of cutting footwear for a client. The lower authorities held against the appellant for failing to substantiate their claim. The appellant raised bills for cutting footwear components and job charges periodically, with no written agreement for labor supply. The appellant and client confirmed in letters that there was no contract for labor supply, and the arrangement was based on labor rates for specific job tasks. The bills indicated lump sum charges for work without details of manpower supply. The Original Authority confirmed the tax liability based on lack of documentary proof from clients, but the client denied any labor supply arrangement with the appellant. The Original Authority's assertion of the client availing services from the appellant lacked supporting evidence. The evidence submitted by the appellant contradicted the claim of providing taxable services as a "Manpower Recruitment and Supply Agency." The Tribunal found no merit in the lower order and set it aside, allowing the appeal.

Conclusion:
The Tribunal overturned the lower authority's decision regarding the service tax demand for "Manpower Recruitment or Supply Agency Services," as the appellant's evidence contradicted the claim of being a manpower supply agency. The lack of supporting documents from clients and the absence of a labor supply agreement led to the Tribunal's decision in favor of the appellant, setting aside the tax liability.