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TMI Blog2024 (8) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... res Integra and having been decided in favour of party and the concerned services not having been found to be the management, maintenance or repair services but production of excisable goods, the demand in view of the stated decisions is not sustainable. Appeal allowed. - MR. SOMESH ARORA, MEMBER (JUDICIAL) AND MR. C. L. MAHAR, MEMBER (TECHNICAL) Shri. M.G. Yagnik, Advocate for the Appellant Shri R R Kurup, Superintendent (AR) for the Respondent ORDER M/s. Gujarat Insecticides Ltd., 805/806, GIDC Estate, Ankleshwar (hereinafter referred to as the 'assessee' for the sake of brevity) are registered with Service Tax holding Certificate No. AAACG8436DST001 for the services of (1) Goods Transport Agency, (ii) Business Auxiliary Services (iii) Manpower Recruitment Agency under Section 69 of Finance Act, 1994 (32 of 1994). The assessee had entered into a Memorandum of Understanding (MOU) with M/s. Gharda Chemicals Ltd. (hereinafter referred as M/s GCL for the sake of brevity) for exclusive use of their plant with all manpower along with common infrastructure facilities (MOU dated 01 April 2015). As per the agreement, the assessee had to provide their plants exclusively for the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enance Repair provided by them to M/s. Gharda Chemicals Ltd., to the concerned Jurisdictional Superintendent of Service Tax as per procedure laid down in Rule 4 of the Service Tax Rules, 1994 read with Section 69 of Finance Act, 1994. It also appeared that the assessee had not paid the Service Tax on the taxable services of 'Management, Maintenance or Repair provided by them to M/s. Gharda Chemicals Ltd., during the period April-2015 to June-2017 as required under Rule 6 of the Service Tax Rules, 1994 read with Section 668 68 of the Finance Act, 1994. It further appeared that the assessee have also not filed the half yearly returns in respect of taxable services 'Management, Maintenance or Repair' provided by them as required under Rule 7 of the Service Tax Rules, 1994 read with Section 70 of the Finance Act, 1994. It also appeared that the assessee had concealed the activities of providing of Services i.e. 'Management, Maintenance or Repair' to M/s Gharda Chemicals Ltd. There was an exchange of correspondence between M/s. Gujarat Insecticides Ltd and the Department and a Show Cause Notice No. V/ST/Guj. Insecticides/Adj/Commr/15/17-18 dated 12.03.2018 was issued ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icals Ltd., were required to supply them, all the Inputs and Packaging Materials, free of charge and they were required to produce excisable goods, as desired by the said M/s. Gharda Chemicals Ltd. As per the said Agreement, for undertaking the aforementioned activities of production of excisable goods, as desired by the said M/s. Gharda Chemicals Ltd., out of the Inputs and Packaging Materials, supplied by them, free of charge, M/s. Gharda Chemicals Ltd were required to utilise their specified Plants, Equipments, Machinery, Labour, Supervisors, Water, Electricity and certain Consumables and Stores, in small quantum. The aforementioned activities, were required to be undertaken by them, for and on behalf of the said M/s. Gharda Chemicals Ltd., under the provisions of Rule 4(5)(a) of the CENVAT Credit Rules, 2004, where under, M/s. Gharda Chemicals Ltd., were required to supply them, the corresponding Inputs and Packaging Materials and the noticee were required to process them, in their specified Plants, by using their Plant, Machinery, Equipment, Labour, Supervisory and Managerial Personnel, Water, Electricity and some Consumables and Stores and return back the processed goods, eit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rovider, that so far as it relates to taxable Service of Management, Maintenance or Repair, the Service Provider, is required to manage, maintain, repair, re-condition, restore or service any Immovable or Movable Property or Goods, belonging to the Service Enjoyer; that in the current case, the entire Plant, Machinery, Equipment, belongs to the noticee and how can the noticee charge Service Tax, to some one, when the Machinery and Equipment remains in the noticee's possession, with their effective control. 2.7. They further submitted that by no means, the Job-work, undertaken by the noticee, for processing the Inputs and Packaging Materials, for and on behalf of the said M/s. Gharda Chemicals Ltd., in which Inputs and Packaging Materials, were supplied to the noticee, free of charge, under Rule 4(5)(a) of the CENVAT Credit Rules, 2004by , the said M/s. Gharda Chemicals Ltd., and return of processed goods, to them, under Non-Duty-Paid Job-work, can be taken as Management, Maintenance or Repair Service; that it is a stretch of imagination, which cannot be imagined, canvassed by the Show cause notice, to call the Job-work as Management, Maintenance or Repair Service. 2.8. They sub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the said M/s. Gharda Chemicals Ltd. 2.10. Further they submitted that assuming without admiting that the Jobwork, undertaken by the noticee, for and on behalf of the said M/s. Gharda Chemicals Ltd., has not resulted into manufacture of a new commodity, even then, Service Tax, is not payable by the noticee, on the Job-work Charges, charged by the noticee, to the said M/s. Gharda Chemicals Ltd., as per the Agreement, entered into between the noticee and the said M/s. Gharda Chemicals Ltd., on account of the provisions of Notification, 8/2005- S.T., dated 1.3.2005, whereunder, a Job- worker is exempt from payment of Service Tax, on the Job-work Charges, charged by him, to the Principal, if, the processed goods, produced by the Job-worker, out of the Inputs, supplied by the Principal, are returned back by the Job-worker, to the said Principal and the Principal, is dearing his final products, from his factory, on payment of Central Excise Duty, at appropriate rate; that nowhere, in the Show cause notice or the Auditors, have established the factual position that M/s. Gharda Chemicals Ltd., cleared their finished excisable goods, produced out of the processed goods, supplied by the noti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that in this episode, there is no question of the noticee having provided any taxable Service, to the sald Mis. Gharda Chemicals Ltd., and described as Management, Maintenance or Repair Service. 2.13. They submitted that the taxable Service, provided by them to the said M/s. Gharda Chemicals Ltd., was apparently Business Auxiliary Service or Job-work but it is not taxable under Business Auxiliary Service, in as much as, it involved production of new commodity, which activity stands excluded from the Business Auxillary Service and even if, it is presumed that the process undertaken by the noticee, does not amount to manufacture, the activity is exempt under the provisions of notification, 8/2005-S.T., dated 1.3.2005 and at the same time, the activity being undertaken under Rule 4(5)(a) of the CENVAT Credit Rules, 2004, no Central Excise Duty, is payable by them, nor Service Tax, can be demanded under Renting of Immovable Property Service or supply of Tangible Goods for Use Service. 2.14. They submitted that on the same question of law, the Hon'ble CESTAT, Ahmedabad has granted unconditional stay and the noticee has requested for a speaking order, without any Personal Hearing. 2 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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