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TMI Blog2021 (9) TMI 772X X X X Extracts X X X X X X X X Extracts X X X X ..... pre-suppose that there was no earlier entry covering the said services. It was also observed that creation of the new entry was not by way of amending the earlier entry and it was not carved out of any earlier entry. The infrastructural support services includes only the service specified in the Explanation, which essentially includes setting up office spaces. Thus, accommodation or guest house facility will not form part of infrastructural support services and cannot be treated as provision of BSS - the Commissioner was not justified in confirming the demand on the amount received for transit house under the category of BSS. Manpower supply services - appellant was supplying manpower to its group companies - HELD THAT:- Reliance was placed in the case of M/S MIKUNI INDIA PVT. LIMITED VERSUS COMMISSIONER OF CENTRAL GOODS AND SERVICE TAX, CUSTOMS CENTRAL EXCISE [ 2019 (8) TMI 260 - CESTAT NEW DELHI] where Division Bench in M/s India Yamaha Motor Private Limited [2019 (7) TMI 772 - CESTAT NEW DELHI] examined the issue both for the period prior to 1 July, 2012 and for the post negative list for the period subsequent to 1 July, 2012 and held that neither during the pre-n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as filed this appeal to assail the order dated April 18, 2013 passed by the Commissioner of Central Excise, Panchkula [the Commissioner], by which part of the demand of service tax proposed in the show cause notice dated February 24, 2011 issued for the period of October 01, 2005 to September 30, 2010 has been confirmed. 2. A summary of the demand proposed in the show cause notice and confirmed/ dropped by the impugned order is given in the following Table: Serial No. Issue Category of Service Period Service Tax/CENVAT Credit demand confirmed/ dropped 1. Transit / Guest House services provided to group companies Infrastructural services under the category of Business Support Services ( BSS ) May 2006 to September 2010 ₹ 1,03,40,124/- confirmed out of ₹ 1,17,45,757/- (₹ 14,05,633/- dropped on account of wrong application of Section 72 of the Act) 2. Transfer of employees group comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aid places on official visit, i.e. for business work of the group companies only. According to the policy of the company, the said transit houses cannot be used for personal use of the employees. The charges of the said transit house were as per the pre-determined tariff. For recovery of the transit house charges, bills were raised by the appellant at the end of the month to the group companies whose employees had availed the said facility in that particular month. The income generated through rent received in relation to the said transit houses was booked by the appellant under the head of transit house income . As part of the Anand Group s policy decision, the employees of the group companies also got transferred to other group companies. In spite of this inter-company transfer of personnel, they continued to remain on the rolls of the company where they were recruited. However, their salary and all other remuneration were paid by the company they were working for and the same was routed through the appellant. 4. A show cause notice dated April 20, 2011 was issued to the appellant for the period from May 01, 2006 to September 30, 2010. The appellant filed a reply to the sh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , accounting and processing of transactions, operational or administrative assistance in any manne, formulation of customer service and pricing policies, infrastructural support services and other transaction processing. Explanation. - For the purposes of this clause, the expression infrastructural support services includes providing office along with office utilities, lounge, reception with competent personnel to handle messages, secretarial services, internet and telecom facilities, pantry and security ; (emphasis supplied) 9. It needs to be noted that BSS was made taxable under section 65 (105) (zzzq) of the Finance Act. This section is reproduced below: Section 65 (105)(zzzq): to any person, by any other person, in relation to support services of business or commerce, in any manner. 10. Learned counsel for the appellant submitted that the provision of housing facility on short term basis is specifically covered under the scope of short-term accommodation services as defined in section 65(105)(zzzzw) of the Finance Act and this service became taxable only from May 01, 2011. The appellant has, accordingly, been paying service tax under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r providing Infrastructural Support in the course of business of the said group companies whereas Guest House services are not exclusively meant for the business persons only but could be used for any purpose and any person . On the basis of above, I find that ratio of judgments cited by the noticee are not applicable as activities undertaken by the noticee were already covered by the existing entry i.e. Business Support Services and the fact that they have obtained Service Tax registration under 'Guest House services w.e.f May 01, 2011 does not alter the situation as the noticee have obtained the Service Tax registration on their own volition under 'Guest House service and paying Service Tax accordingly. Therefore, the Service Tax liability of the noticee for the previous period remains un-altered under the correct category of Business Support Services irrespective of the subsequent voluntary action of the noticee in obtaining Service Tax registration under the category of Guest House service. (emphasis supplied) 12. The submission advanced by the learned counsel for the appellant deserves to be accepted. The provision of housing facility on short-term ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ered by entry (zzzy) and entry (zzzzj). Such a result is difficult to comprehend because entry (zzzzj) is not a specie of what is covered by entry (zzzy). Introduction of new entry and inclusion of certain services in that entry would presuppose that there was no earlier entry covering the said services. Therefore, prior to introduction of entry (zzzzj), the services rendered by the members of the 1st petitioner were not taxable . Creation of new entry is not by way of amending the earlier entry. It is not a carve out of the earlier entry. Therefore, the services rendered by the members of the 1st petitioner cannot be brought to tax under that entry. (emphasis supplied) 14. This judgment of the Bombay High Court was followed by the Tribunal in Quippo Oil and Gas Infrastructure Ltd. ; Global Coal Mining Pvt. Ltd and Malviya National Institute of Technology. 15. Even otherwise, accommodation or guest house facility does not form part of infrastructural service and, therefore, cannot be treated as provision of BSS. This follows from the definition of BSS in section 65 (104c) of the Finance Act and the Explanation contained therein. BSS means service provide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at providing place within the premises of the turf club by way of stall or canteen for consideration, is nothing but hiring or leasing of immovable property and cannot be considered as business support service. 9. In Mundra Port Special Economic Zone Ltd. [ 2012 (27) S.T.R. 171 (Tri. Amd) ], , the Tribunal held providing railway lines inside the port area for the railways to move the wagons cannot be considered as providing infrastructural facilities to the railways. It is a beneficial arrangement for both the parties and there is no service of business support by one to another. 10. The appellants strongly pleaded that the scope of infrastructure support as mentioned under tax entry business support service will not cover the present case. Reliance was placed on the explanation to state that the nature of activities which are to be generally considered as infrastructural support service can be ascertained from such inclusive definition. These are mainly administrative and office related support. The type of activities like putting up and managing gas storage facility in industrial unit are not fitting into overall scope of the infrastructural support service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... MI 1022-CESTAT Bangalore ]. 22. In Computer Sciences Corporation India P. Ltd., the Allahabad High Court made the following observations: 8. In the present case, the Commissioner clearly missed the requirement that the service which is provided or to be provided, must be by a manpower recruitment or supply agency. Moreover, such a service has to be in relation to the supply of manpower. The assessee obtained from its group companies directly or by transfer of the employees, the services of expatriate employees. The assessee paid the salaries of the employees in India, deducted tax and contributed to statutory social security benefits such as provident fund. The assessee was also required to remit contributions, which had to be paid towards social security and other benefits that were payable to the account of the employees under the laws of the foreign jurisdiction. There was no basis whatsoever to hold that in such a transaction, a taxable service involving the recruitment or supply of manpower was provided by a manpower recruitment or supply agency. Unless the critical requirements of clause (k) of Section 65(105) are fulfilled, the element of taxability would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... regard are as follows: I have gone through the facts of the case and various submissions made by the noticee in respect of this demand of ₹ 2,14,001/- and find that the figures mentioned by the noticee at this stage do not co-relate with the figures mentioned in their statutory records , therefore, the plea taken by the noticee is not acceptable. In view of the above, I hold that the noticee have failed to reconcile the figures and justify the difference noticed by the department in their statutory records and ST-3 Returns for the period under dispute. Accordingly, I confirm the demand of ₹ 2,14,001/- raised by the department on this issue. 29. Learned counsel for the appellant submitted that the said demand is not sustainable as the impugned proceedings have failed to identify the specific category of taxable service under which such demand has been confirmed and in any case, the difference has arisen only because the appellant reported wrong value on cum-tax basis in the ST-3 returns, while it had paid service tax on the correct value. While calculating the cum-tax value, the appellant applied the rate of service tax @ 10.20%, whereas it paid service tax @ ..... X X X X Extracts X X X X X X X X Extracts X X X X
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