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TMI Blog2025 (4) TMI 244X X X X Extracts X X X X X X X X Extracts X X X X ..... ing, the appellant returned the processed goods to their principal namely, M/s. Durgapur Steel Plant. They further did the process of ultrasonic test, painting, etc., and thereafter, the goods were sold by the principal on payment of duty. 2.1 The Revenue is of the view that the activity undertaken by the appellant does not amount to manufacture; therefore, they are liable to pay Service Tax under the category of "business auxiliary service". 3. In these set of facts, proceedings were initiated against the appellant by demanding Service Tax on their activity and the matter was adjudicated wherein the demand of Service Tax came to be confirmed. Against the said order, the appellant is before us. 4. The ld.Counsel for the appellant, submits that in their own case for the earlier period, it was held that no service tax is payable by the appellant. Therefore, the impugned order is to be set aside. 5. The ld.A.R. for the Revenue supported the impugned order. 6. Heard both the parties and considered the submissions. 7. We find that in the appellant's own case for the earlier period vide Final Order No.75473/2024 dated 06.03.2024, this Tribunal has observed as under : "7. We find ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ................ 8. Having appreciated the submissions made by both the sides, we first of all note that there is no dispute on the detailed activity undertaken by the appellant vide which they separate the iron metal from the molten slag. As such we do not feel the need of referring the same, as the dispute does not revolves around the said activity, but relates to as to whether the said activity can be called as "production of goods" and further "on behalf of the client". As regards the expression "production of goods", we note that the same was amended in June 2005 and was substituted by the expression - "processing" of goods. As such it is clear that prior to the amendment and in the absence of the words "processing" the same has to be interpreted in a manner that the activity results in production of goods. We may here observe that every production may not amount to manufacture but admittedly every manufacturing activity involves production of goods, inasmuch as the term "manufacture" would include production though every production may not include the manufacturing activity. Inasmuch as the Commissioner in his order dated 21-9-2006 has held that the said activity does no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... behalf of the client would be liable to service tax". 10. Apart from the above circulars of the Board there are decisions of the Tribunal settling the issue at rest. In the case of Auto Coats - 2009(15) S.T.R. 398 (Tri.-Chen.) it stands held that prior to 16-6- 2005 unless a person was engaged by another for processing the goods entrusted by a third person, such activity would not be exigible to service tax. Similarly in the case of Sonic Watches Ltd. - 2011 (21) S.T.R. 34 (Tri.) it was held as under : "5. We find that activity undertaken by the appellants in this case was similar to the one as existed in the case of Auto Coats. Therefore, in the light of above two decisions discussed above, it cannot be said that appellants have undertaken job work on behalf of the clients, in view of the fact that there were only two parties to the transaction in this case, whereas where the production is on behalf of the clients, there would be three parties. Since, services undertaken by the appellants is not covered by the definition, no service tax is attracted. Accordingly, impugned order is set aside and appeal is allowed". Further, in the case of Rathour Engg. Works - 2012 (27) S.T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the said exemption to the appellant. For ready reference, we reproduce below the Notification No. 8/2005-S.T. ibid : "In exercise of the powers conferred by sub-section (1) of Section 93of the Finance Act, 1994 (32 of 1994) (hereinafter referred to as the Finance Act), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts the taxable service of [production or processing of goods for, or on behalf of, the client] referred in sub-clause (v) of clause (19) of Section 65 of the said Finance Act, from the whole of service tax leviable thereon under Section 66 of the said Finance Act : Provided that the said exemption shall apply only in cases where such goods are produced [or processed] using raw materials or semi- finished goods supplied by the client and goods so produced [or processed] are returned back to the said client for use in or in relation to manufacture of any other goods falling under the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), as amended by the Central Excise Tariff (Amendment) Act, 2004 (5 of 2005), on which appropriate duty of excise is payable. Explanation. - For the purpose ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een the decision of the Tribunal as upheld by Hon'ble High Court in the case of Modi Construction Co. vs. CCE, Ranchi (supra), it stands clearly held by the Tribunal that service of shifting, transportation or raw materials, waste materials, and finished products from one place to another, inside the plant itself, does not fall under the taxing category of Cargo Handling Services. The activities undertaken by the appellant are admittedly within the plant itself. As such, we find that the ratio of the law declared by he Tribunal in the above referred matter, which also stands upheld by the Hon'ble Jharkhand High Court, is fully applicable to the facts of this case." 10. In view of the aforesaid, the issue is no longer resintegra, since decided in favour of the assessee. We do not find any reason to take contrary view and therefore, the demand raised vide the impugned adjudication order cannot be sustained and hence, the same is set aside. Consequently, the appeal filed by Revenue to dispute the cum tax benefit is liable to be rejected since there cannot be demand of service tax as held above. 11. The appeal filed by assessee is thus allowed with consequential relief as per law ..... X X X X Extracts X X X X X X X X Extracts X X X X
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