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TMI Blog2024 (12) TMI 670X X X X Extracts X X X X X X X X Extracts X X X X ..... he seven partners which included the appellant as one of the partners. Later, the appellant was entrusted the work to extract the Iron Ore from the leased mine belonging to the partnership firm and for that, the appellant being one of the partners of the partnership firm was allowed a profit of 64% of the extracted ore and the other partners of 36% of the extracted ore. Therefore, the facts are squarely covered by the ratio of the judgment of the Hon ble Gujarat High Court in the case of Cadilla Healthcare Ltd. [ 2022 (5) TMI 800 - GUJARAT HIGH COURT ]. Their Lordships referring to the judgment of the Punjab Haryana High Court, held that ' The High Court observed that a partnership is an agreement between two or more persons to place their capital, labour and skill, or some or all of them for the purpose of carrying on a joint business for their common benefit and dividing its profits in certain proportions. The privilege of profit sharing imposes on each partner the obligation to advance the interests of the partnership business, to apply his time and attention to the management of its affairs, and to devote his knowledge. skill and ability to the success of the enterprise. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... racted/mined ore. He has submitted that the firm M/s. Sree Gavisiddeshwara Minerals was formed with the objective for conducting the business of carrying on mining operations in respect of the major mineral Iron Ore and selling the mined and extracted minerals under the name of M/s. Sree Gavisiddeshwara Minerals. They were holding a Mining Lease licence bearing No. ML No.2552 over an extent of 134 hectares of land in Donimalai Range, Sundur Taluk. 3.2. Assailing the impugned order, the learned advocate has submitted that activity undertaken by the appellant i.e. extraction of Iron Ore from the leased mines is manufacture and the Iron Ore is classifiable under Chapter 26 of the Central Excise Tariff which attracts NIL rate of duty in view of the Effective Rate Notification No.4/2006-CE dated 01.03.2006 as amended. Further, he has submitted that Section 3 of Iron Ore, Manganese Ore Mines and Chrome Ore Mines Labour Welfare Cess Act, 1976 imposes cess on Iron Ore manufactured and hence, the same would be an excisable goods. In support, they have referred to the decision of Hon ble Supreme Court in the case of CIT Vs. Sesa Goa Ltd. [2004 271 ITR 331 (SC)]. Also, they place reliance on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt charged for providing such taxable services; any other amount which is calculated not for providing such taxable services cannot be a part of the value as that amount is not calculated for providing such taxable services. In support, he has referred to the judgment of the Hon ble Supreme Court in the case of UOI Vs. Intercontinental Consultants and Technocrats Pvt. Ltd. [2018(10) GSTL 401 (SC)]. He has submitted that Iron Ore was delivered to the appellant pursuant to his share under the partnership deed and not as consideration for undertaking ore raising activity. It is also admitted in the notice that ore was appropriated by the Mining Lease licence holder i.e. M/s. Sree Gavisiddeshwara Minerals, after the ore is raised and the partnership firm sells the ore to all partners individually clearly shows that the agreement between the partners were not binding on the firm. The agreement is therefore only between the company and the individuals and they have not entered into the agreement on behalf of the firm. This agreement entered into by the individuals have no bearing on the firm and it is therefore internal agreement to undertake the activity and share the proceeds. It is su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he appellant that they had received only 64% of the Iron Ore extracted as a percentage of their share and no value has been received for raising of the mineral, hence the share is not liable to tax, he has submitted that the issue involved in the case of Larsen Toubro Ltd. was different as the liability to tax was ascertained when clearance from SEZ Unit of the company was made to their DTA unit and both were part of one entity. The said transaction was effected without any payment of cash or kind; thus, the facts of the said case are distinguishable to the present one. Referring to para 16 17 of the impugned order, the learned AR has submitted that in view of Rule 3 of Service Tax (Determination of Value) Rules, 2006, the equivalent money value of such consideration has to be arrived at and accordingly, the adjudicating authority has arrived at the equivalent money value of the consideration equivalent to 64% of the Iron Ore received by the appellant. Further, he has submitted that the judgment of the Hon ble Supreme Court in Intercontinental Consultants and Technocrats Pvt. Ltd. (supra) is not applicable to the facts of the present case. On the issue of suppression of facts, the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... required to be discharged on the value of the quantity of ore received when sold by the appellant in the market being the consideration towards rendering of services classifiable under the taxable category of Mining of Mineral, oil or gas services . The appellant s contention on the other hand is that since the appellant is one of the partners of the partnership firm M/s. Sree Gavisiddeshwara Minerals who have been entrusted with the work of extraction of mine by other six partners by an agreement dated 26.03.2010 and the 64% of the total ore extracted being the share in the partnership firm; therefore no service has been rendered by the appellant but it was extracted by the partnership firm itself; hence no service tax is applicable. In other words, they have argued that the service is in the nature of self-service. The partnership deed dated 25.03.2010 and the agreement dated 26/03/2010 under which the appellant was entrusted the work for extraction of Iron Ore are enclosed with appeal paperbook. 8. A plain reading of the reconstituted partnership of M/s. Sree Gavisiddeshwara Minerals which was originally registered on 27.08.2007 comprising of the seven partners which included t ..... 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