2015 (8) TMI 1193 - AT - Service Tax

Appellant Prevails: Service Tax Liability Not Applicable in Manpower Recruitment

Vidharbha Iron & Steel Co. Ltd. Versus Commissioner of CE & Customs, Nagpur

The bench found in favor of the appellant, ruling that the service tax liability under the category of man power recruitment and supply agency services ... Manpower recruitment and supply agency services - Held that:- Issue involved in this case is now squarely settled by the Hon’ble High Court of Gujarat in the case of Arvind Mills Ltd. as reported in [2014 (4) TMI 132 - GUJARAT HIGH COURT] upholding the decision of the Tribunal in the case of Arvind Mills Ltd [2013 (10) TMI 821 - CESTAT AHMEDABAD]. This bench has followed the ratio in the appellants own case [2015 (8) TMI 593 - CESTAT MUMBAI] in an identical issue for earlier period held in the favour of appellant. The reliance placed by the departmental representative to canvas the case of Daurala organics - [2009 (3) TMI 99 - CESTAT NEW DELHI] may not carry the case of revenue any further as the judgement of Honourable High Court of Gujarat in the case of Arvind Mills Ltd. (supra) was delivered subsequently - impugned order is unsustainable and liable to be set aside - Decided in favour of assessee. Issues:Service tax liability on appellant under the category of man power recruitment and supply agency services.Analysis:The appeal was against an order dated 23/08/2011 regarding service tax liability on the appellant under man power recruitment and supply agency services. The appellant had rented out factory premises to FACOR as per the arrangement of the High Court of Bombay, with employees working for FACOR and salaries reimbursed to the appellant. The revenue claimed the amount received by the appellant was taxable under manpower recruitment services. The bench noted that the issue was settled in the appellant's own case and by the High Court of Gujarat in the case of Arvind Mills Ltd. The bench followed the precedent and held in favor of the appellant, stating that the reliance on a previous judgment by the departmental representative was not valid as the High Court's decision in the Arvind Mills Ltd. case superseded it.The bench found that the issue was already settled in the appellant's favor based on previous judgments and precedents. Citing the decision in the appellant's own case and the High Court of Gujarat's ruling in the Arvind Mills Ltd. case, the bench concluded that the impugned order was unsustainable. Therefore, the bench set aside the impugned order and allowed the appeal in favor of the appellant.