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TMI Blog2022 (8) TMI 539X X X X Extracts X X X X X X X X Extracts X X X X ..... e has not disputed the fact that excise duty is being paid by IOCL on clearances of gas cylinders and that the expenditure is also a part of the valuation adopted for such purposes. Since these facts are not being disputed by the Revenue, therefore it is held that the activities undertaken by the Appellant would squarely be covered under the definition of manufacture under Section 2(f) of the Central Excise Act, 1944 and thus the said demand under packaging service cannot sustain. Works Contract Services - HELD THAT:- The Appellant has not disputed the demand on merits but only on limitation. The demand was raised based on audit of IOCL records. It is found that service tax is a self assessment regime and one cannot take the plea of be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ected muck/sludge, dirt, and bottling of LPG into cylinders to be sold by IOCL for the purpose of domestic use within the bottling premises set up by IOCL and for which the Appellant is being paid charges as fixed by IOCL for carrying out the above gamut of activities. The department was of the view that such activities tantamount to packaging service under Section 65(76b) of the Finance Act, 1994 and the same does not amount to manufacture under Section 2(f) of the Central Excise Act, 1944 in order to provide the Appellants with any exemption from payment of service tax on such charges received. Further, the Appellant had carried out certain works contract activity also in the premises of the IOCL and on which the demand has been confirmed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rance of cylinders under CETH 2711 which has not been disputed by the revenue. Further the chapter notes to Chapter 27 also states that such process would amount to manufacture. They further relied upon the judgment of the Hon ble Supreme Court in the case of Commissioner of Income Tax -1, Mumbai Vs. Hindustan Petroleum Corporation Ltd. [MANU/SC/0936/2017]. 4. The Appellant also contended that the demand under works contract service is barred by limitation as there cannot be any suppression in the case of the Appellant as everything was recorded in the books of the Appellant. 5. The Ld. Authorized Representative for the department reiterated the findings of the Appellate Authority and the Ld. Adjudicating authority. He relied upon the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to 30/06/2012 and the negative list entry post 30/06/2012, both the entries provide an exemption from service tax if the process amounts to manufacture. Section 2(f) of the Central Excises and Salt Act, 1944 states as under: (f) manufacture includes any process (i) incidental or ancillary to the completion of a manufactured product. Section 2(k) of the Factories Act, 1948 that defines manufacturing process states as under: (k) manufacturing process means any process for (i) making, altering, repairing, ornamenting, finishing, packing, oiling, washing, cleaning, breaking up, demolishing, or otherwise treating or adapting any article or substance with a view to its use, sale, transport, delivery or disposal; Rule 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... therefore we are inclined to hold that the activities undertaken by the Appellant would squarely be covered under the definition of manufacture under Section 2(f) of the Central Excise Act, 1944 and thus the said demand under packaging service cannot sustain and we order accordingly. 10. The above is further fortified from the fact that the Chapter notes to Chapter 27 of the Tariff also provides such process to be manufacture under the Central Excise Act, 1944 for natural gas. Hence the argument of the Revenue that such explanation only is applicable for natural gas and that LPG is not a form of natural gas cannot be sustained in our view and hence the demand on the packaging services has to be set aside. 10.1 Further, as regards the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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