Chilling of milk treated as manufacture, taking the activity outside Business Auxiliary Service and service tax liability.

Chilling of milk is treated as manufacture under Note 6 of Chapter 4 of the Central Excise Tariff Act, 1985 where the facts are identical to earlier settled cases. Because the activity qualifies as manufacture, it falls outside the scope of Business Auxiliary Service and is not liable to service tax on that basis. The impugned order was set aside and the appeal was allowed.

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Issues: Whether the activity of chilling milk is liable to service tax under Business Auxiliary Service.

Analysis: The Tribunal noted that the dispute had already been settled in earlier cases involving identical facts. It followed the settled view that chilling of milk amounts to manufacture within Note 6 of Chapter 4 of the Central Excise Tariff Act, 1985. Once the activity is treated as manufacture, it does not fall for taxation under Business Auxiliary Service.

Conclusion: The activity of chilling milk is not taxable under Business Auxiliary Service and the appeal was allowed by setting aside the impugned order.

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