9911796707
TMI Blog2009 (9) TMI 276X X X X Extracts X X X X X X X X Extracts X X X X ..... other constituent units of HUF like Parade, Rhythm, Ushakiron Movies etc. It was alleged that the respondents had rendered services in the form of Manpower Supply Service to their other constituent units of HUF, sister concerns and group companies located within the premises of Ramoji Film City and not paid Service tax on the amount received by them. The respondents paid service tax of Rs. 13,61,712 and education cess of Rs. 27,235 through cash and Rs. 74,654 through debit in their Cenvat account, on the amounts received from other units which are legally separate entities, before issue of show-cause notice. They had not paid service tax on the amount representing the services rendered to the other constituents of HUF on the ground that dif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... act that there exists a service provider/client relation and consideration for service provided which are requirements for levy of service tax regardless of the stand as to how the units of HUF are treated as single legal entity under different laws. That the OIA's conclusion is flawed will be all the more clear when the facts are placed against the statutory provisions. (b) As per the section 65(105)(k) of the Finance Act, 1994, the Manpower Recruitment or Supply Agency's Service is defined as under :— "(k) Taxable Service means any service provided to a client, by a manpower recruitment or supply agency in relation to the recruitment or supply of manpower, temporary or otherwise, in any manner." (c) Further, as per section 65(68) of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... registered with the department for payment of Service Tax under the category of 'Rent-a-Cab Operator' and following the prescribed procedure. Therefore, the assessee is liable to pay both interest as well as the penalties applicable under law. (f) In view of the above, the Order-in-Appeal No. 23/2008(H.III) ST, dated 25-7-2008 passed by the Commissioner (Appeals) is not proper and legal on the issue of liability of Service Tax on the services rendered to other constituents of HUF. The Committee, therefore, under provisions of section 86(2A) of the Finance Act, 1994 directs the Assistant Commissioner, Service Tax Cell, Hyderabad-III, Commissionerate to apply to the Customs, Excise and Service Tax Appellate Tribunal for determination of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gs recorded in the impugned orders. The short issue to be decided in the present case is whether the Appellants are liable to service tax on the service provided to other constituents of HUF. 6. In the instant case, the Appellants are not contesting the liability of service tax on the service provided to other units, which are legally separate entities. They contend that they are one of the constituents of HUF, and different units of the same HUF doing different businesses cannot be treated as separate legal entities. It was alleged in the show-cause notice that all the constituent units are independent concerns and are registered under relevant laws and have independent business activities. The adjudicating authority also held that servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provider and the service receiver are part of the corporate entity which is known as M/s. Precot Mills Ltd. It was emphasised that the debit note was issued only to evaluate the performance of Dyeing Unit as each unit is a separate profit centre. M/s. Precot Mills Ltd. is a corporate entity. It has got various units which function as separate profit centres, when service is rendered by one unit to the other, debit note is raised for the value of service in order to evaluate the performance of a particular unit. Ultimately there is only one Balance Sheet for the legal entity for M/s. Precot Mills Ltd. and not for the separate unit. In other words, the appellants, M/s. Precot Mills Ltd. do not receive any valuable consideration for services ..... X X X X Extracts X X X X X X X X Extracts X X X X
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