9911796707
TMI Blog2020 (1) TMI 6X X X X Extracts X X X X X X X X Extracts X X X X ..... as a manufacturer, is not being fully utilized by M/s Parle, their claim of ex-gratia charges arises so as to compensate them from the financial damage/injury. As such, ex-gratia amount is not fixed and is mutually decided between the two, based upon the terms and conditions of the agreement and is in the nature of compensation in case of low/less utilization of the production capacity of the assessee. In the present case apart from manufacturing and receiving the cost of the same, the appellants were also receiving the compensation charges under the head ex-gratia job charges. The same are not covered by any of the Acts as described under Section 66E (e) of the Finance Act, 1994. The said Sub-clause proceeds to state various active and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... G. SHAKKARWAR, MEMBER (TECHNICAL) Shri H. P. Kanade, Advocate for the Appellant Shri Shiv Pratap Singh, Authorised Representative for the Respondent ORDER PER: ARCHANA WADHWA As per facts on record the appellant is engaged in the manufacture of confectionaries falling under Chapter 17 of Central Excise Tariff Act, 1985 for and on behalf of the principal manufacturer M/s Parle Biscuits Pvt. Ltd., in terms of the agreement entered between the two. M/s Parle is procuring the raw material and supplying the same to the appellant for manufacture of the confectionaries, which were being cleared by the appellant on payment of Excise duty on MRP as declared by M/s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hence the present appeal. 4. After hearing both the sides duly represented by Shri H. P. Kanade, learned advocate appearing for the appellant and Shri Shiv Pratap Singh, learned A.R. appearing for the Revenue, we find that the short issue required to be decided in the present appeal is as to whether the receipt of ex-gratia job charges amount by the appellant amounts to providing any services so as to attract the Service Tax on the same. We find that appellant is admittedly manufacturing confectionaries for and on behalf of the M/s Parle and is clearing the same upon payment of Central Excise duty on the basis of MRP declared by M/s Parle. It is only in situation when the appellant s capacity, as a manufacturer, is not being ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se proceeds to state various active and passive actions or reactions which are declared to be a service namely; to refrain from an act, or to tolerate an act or a situation, or to do an act. As such for invocation of the said clause, there has to be first a concurrence to assume an obligation to refrain from an act or tolerate an act etc. which are clearly absent in the present case. In the instant case, if the delivery of project gets delayed, or any other terms of the contract gests breached, which were expected to cause some damage or loss to the appellant, the contract itself provides for compensation to make good the possible damages owning to delay, or breach, as the case may be, by way of payment of liquidated damages by the contract ..... X X X X Extracts X X X X X X X X Extracts X X X X
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