2018 (6) TMI 1355 - AT - Service Tax

Liability of Service Tax - Manpower Supply Services - case of appellant is that the service tax on the service has been paid by the service recipient - Held that - Admittedly Manpower Supply Services cannot be considered to be either as a part of the construction services or sub-contract of the main contractor of civil construction services - Neither any evidence has been shown to us to substantiate the plea that the main contractor has discharged Service Tax liability in respect of the said Manpower Supply Services provided by the appellant - demand upheld - appeal dismissed - decided against appellant.

Summary

Issues:
Service Tax liability on Manpower Supply Services

Analysis:
The judgment by the Appellate Tribunal CESTAT ALLAHABAD dealt with the issue of Service Tax liability on Manpower Supply Services provided by the appellant. The Service Tax amounting to ?24,56,897/- was confirmed against the appellant under the category of 'Manpower Supply Services' provided to M/s. Simplex Infrastructure Limited, who in turn utilized the manpower in providing construction services to M/s. Grasim Industries Limited. The appellant contended that the Service Tax was being paid by the service recipient, but the Commissioner (Appeals) ruled that the responsibility of payment of Service Tax lies with the service provider as per Section 68 of the Act. The Commissioner observed that no Service Tax was paid by M/s. Simplex Infrastructure Limited for the Manpower Supply Services provided by the appellant.

The appellate authority examined the invoices and concluded that M/s. Simplex Infrastructure Limited only provided construction services to M/s. Grasim Industries Limited, and the Manpower Supply Services could not be considered a sub-contract of the construction services. The appellant failed to provide evidence contrary to this finding. The appellant's argument that they were a sub-contractor and the principal contractor had paid the Service Tax was not substantiated. The tribunal found that the Manpower Supply Services could not be considered part of the construction services or a sub-contract of the main contractor, and no evidence was presented to show that the main contractor had discharged the Service Tax liability for the Manpower Supply Services provided by the appellant.

In conclusion, the tribunal rejected the appeal, stating that the Manpower Supply Services could not be considered part of the construction services or a sub-contract of the main contractor. The appellant failed to provide evidence that the main contractor had paid the Service Tax liability for the services provided by the appellant. Therefore, the Service Tax liability on the Manpower Supply Services was upheld, and the appeal was dismissed.