Contract for lump sum work execution was not manpower supply service, so the tax demand and penalty failed.

The contract was for execution of specified works such as unloading, washing, stacking and cleaning, with consideration linked to work performed rather than the number of persons deployed. Because the workforce remained under the contractor's control and supervision, the arrangement was treated as lump sum work execution and not manpower recruitment or supply agency service. The tax demand therefore failed on merits, and the penalty also could not survive.

---

---

Issues: Whether the services rendered under the contract were classifiable as manpower recruitment or supply agency service.

Analysis: The contractual terms showed that the appellants were engaged to perform specified quality works such as unloading, washing, stacking, cleaning and related activities. The consideration was linked to the work executed and not to the number of persons deployed. The workforce remained under the appellants' control and supervision. Reading the contract as a whole, the arrangement was for execution of lump sum work and not for supply of manpower, and the demand could not be sustained under the manpower recruitment or supply agency category. Since the tax demand failed on merits, the penalty also could not survive.

Conclusion: The services were not taxable as manpower recruitment or supply agency service and the demand and penalty were unsustainable.

---