2023 (10) TMI 430 - AT - Service Tax

Levy of Service Tax - Manpower Supply Services - appellant are a Society registered under Andhra Pradesh Co-operatives Societies Act 1964 - HELD THAT - There is no exclusion or exemption granted to societies who has to avoid payment of service tax. On going through the Order-in-Original, it is observed that the appellant has taken the same pleading before the Adjudicating Authority. The Adjudicating Authority has given a very detailed findings and has held that the appellants arguments cannot be legally sustained. There are no reason to interfere with the detailed and considered decision given by the Adjudicating Authority - appeal dismissed.

Summary

Issues involved:
The issue involves whether a society registered under the Andhra Pradesh Co-operatives Societies Act 1964 is liable to pay service tax for providing Manpower Recruitment or Supply Agency services to a client.

Summary:
The Appellate Tribunal CESTAT Hyderabad considered the case where the Appellant, a society registered under the Andhra Pradesh Co-operatives Societies Act 1964, provided Manpower Recruitment or Supply Agency services to ONGC during 2010-11. The Adjudicating Authority confirmed the demand for service tax, stating that the activities fell under the definition of "manpower recruitment or supply agency" service. The Tribunal observed that the service provider maintained the contract workers' payrolls and discharged statutory obligations, making them liable to pay service tax. The Appellant argued that as a society, they were not a commercial concern and should be exempt from service tax. However, the Tribunal held that the society, being a registered body and a juristic person, fell within the definition of "person" for taxation purposes. The Tribunal also noted clauses in the agreement holding the service provider responsible for paying taxes. Ultimately, the Tribunal dismissed the appeal, upholding the Adjudicating Authority's decision.

In conclusion, the Tribunal affirmed that the society, despite being a co-operative society, was liable to pay service tax as they provided services on a commercial basis and fell within the definition of "person" for taxation purposes. The Tribunal emphasized the responsibility of the service provider to pay taxes as per the agreement terms, leading to the dismissal of the appeal.