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TMI Blog2025 (2) TMI 1017X X X X Extracts X X X X X X X X Extracts X X X X ..... rrangement between the appellant and the JV does not fall under the taxable service of manpower supply service as defined under rule 2(g) of the Service Tax Rules. Accordingly, the reimbursements received by the appellant cannot be considered as 'consideration' towards any taxable service. The instant case is squarely covered by the decision of the Hon'ble Apex Court in COMMISSIONER OF CGST, DELHI SOUTH Versus BOEING INDIA DEFENSE PVT. LTD. [2023 (12) TMI 239 - SC ORDER] where it was held that 'The issues which arise in these appeals are covered by the judgment of this Court in UNION OF INDIA AND ANR. VERSUS M/S. INTERCONTINENTAL CONSULTANTS AND TECHNOCRATS PVT. LTD. [2018 (3) TMI 357 - SUPREME COURT] where it was held that onl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ong with interest and imposed equal amount of tax as penalty under Section 78 of the Finance Act, 1994. 2. Briefly stated facts of the case are that the appellant is engaged in the business of transmission of natural gas through pipeline network and sale of gas. The appellant has a joint venture (DNP) with Num Aligarh Refinery Ltd. (NRL), having 26% share, Oil India Limited (OIL), having 23% share and the appellant 51% share. As a lead JV partner, the technical and non-technical personnel of the appellant is engaged in execution of the project. In terms of the JV Agreement and the decision of the JV partners, the cost of such personnel is reimbursed to the appellant on actual basis. 2.1. The department considered the reimbursable expens ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rsonnel engaged are the employees of the appellant company and the appellant is paying all salaries etc. to such employees. Only cost of such employees are reimbursed by the JV. The whole arrangement between the appellant and the JV does not fall under the taxable service of manpower supply service as defined under rule 2(g) of the Service Tax Rules. 3.2. The appellant submits that the instant case is squarely covered by the decision of the Hon'ble Apex Court in COMMISSIONER OF CGST, DELHI SOUTH Versus BOEING INDIA DEFENSE PVT. LTD., 2024 (388) E.L.T. 37 (S.C.) and UNION OF INDIA Versus INTERCONTINENTAL CONSULTANTS AND TECHNOCRATS PVT. LTD., 2018 (10) G.S.T.L. 401 (S.C.). 3.3. The appellant further submits that whole demand is barred by ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in execution of the project. In terms of the JV Agreement and the decision of the JV partners, the cost of such personnel is reimbursed to the appellant on actual basis. As the appellant is the Lead Partner with 51% share, we observe that in this case the service rendered by the appellant is not for any other company but to themselves. Thus, there is no service provider and service receiver relationship exists in the transaction. We observe that the personnel engaged are the employees of the appellant company and the appellant is paying all salaries etc. to such employees. Only cost of salary of such employees are reimbursed by the JV on actual basis. Thus, we observe that the whole arrangement between the appellant and the JV does not f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arch,2014. The relevant part of the said decision is reproduced below: 29. In the present case, the aforesaid view gets strengthened from the manner in which the Legislature itself acted. Realising that Section 67, dealing with valuation of taxable services, does not include reimbursable expenses for providing such service, the Legislature amended by Finance Act, 2015 with effect from May 14, 2015, whereby Clause (a) which deals with 'consideration' is suitably amended to include reimbursable expenditure or cost incurred by the service provider and charged, in the course of providing or agreeing to provide a taxable service. Thus, only with effect from May 14, 2015, by virtue of provisions of Section 67 itself, such reimbursable expendit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case, the Show Cause Notice dated 16-09-2014 has been issued by invoking the larger period under proviso to the Section 73(1) of the Act, whereas the activity of the appellant is well within the knowledge the of the respondent when first Show Cause Notice, dated 09- 04-2013 was issued. Hence, we hold that the whole demand is barred by limitation. The issue squarely covered by the decision of the Hon'ble Supreme Court in Nizam Sugar Factory Vs. Collector of Central Excise, A.P., 2006(197) E.L.T.465 (SC). 6.6. In view of the above discussion, we hold that the demand of service tax confirmed in the impugned order is not sustainable on merits as well as on limitation. Accordingly, we set aside the same. As the demand it self is not sustainab ..... X X X X Extracts X X X X X X X X Extracts X X X X
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