2013 (9) TMI 951

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....Agency Service" under Section 65(105)(k) of the Finance Act, 1994 read with Section 65(68) of the Act. Revenue was of the view that the applicant was providing service under this category and on such reasoning a show-cause notice was issued demanding service tax for the period October 2005 to September 2010 which was adjudicated and confirming a demand of Rs.5,23,57,493/- along with interest and penalties. 2. The counsel for the applicant submits that the labourers employed for cutting of cane were not their employees and such labourers were not on their rolls. They did not pay any ESI benefit to the persons concerned. According to him, the labourers in this sector are organized and mobilizing them is sometimes difficult for small farmer....

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....t of each. The labour charges are paid by the applicant. The applicant fixes the terms of payment. They were also retaining an amount of Rs.5/- per MT from the amounts to be paid to the labourers to retain the labourers with the applicant. Thus the entire control over the labourers is with the applicant. The learned AR submits that it is not necessary that there is no criterion in the definition of manpower supply agency regarding employer-employee relationship and this argument is totally extraneous to the definition of the service at section 65 (68) or section 65 (105) (k). 6. He further stress that the definition at 65 (68) would cover any agency engaged in any activity directly or indirectly in supply of manpower. The applicant are d....

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....g of payments is not coming out from the adjudication order. We are prima facie of the view that the applicant has been making some co-ordination for making available labourer and routing payments from farmers to labourer - some of it as advance and some of it as payment after work done. There is no finding that the applicant is getting any money from this activity, though there is a reference to some money retained from payment to be made to the labourers. It is not clear whether the amount is appropriated as consideration for this activity. That being the case prima facie it appears that no taxable service is rendered because having a database of labourers or routing of the labourers or payments for the labourers may not be sufficient to ....