2014 (9) TMI 482

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.... Order No. & date appealed against Authority passing the order Amount of service tax confirmed Name of the Service recipient 1 ST/141/10 Bhogavati Janseva Trust 10/ST/2009 dated 31-12-2009 CCE Kolhapur 1,08,99,309/- Balasaheb Desai SSK Ltd. 2 ST/147/10 Shamrao Patil YSOTVSM 9/ST/2009 dated 31-12-2009 CCE Kolhapur 1,40,04,212/- Sharad SSK Ltd. 3 ST/151/10 Abhijeetdada Kadam OU&OTVSS Ltd. 11/ST/2009 dated 31-12-2009 CCE Kolhapur 1,40,40,850/- Sonhira SSK Ltd. Vangi 4 ST/170/10 Krishna S & SSSS 5/ST/2009 dated 24-12-2009 CCE Kolhapur 3,21,71,497/- Yashwantrao Mohite Krishna SSK Ltd. 5 ST/173/10 Vasantdada Serve Seva Sagh 12/ST/2009 dated 31-12-2009 CCE Kolhapur 2,87,15,685/- Vasantdada SSK Ltd. 6 ....

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....iew that the activity undertaken by the appellants amount to supply of manpower and therefore, the appellants are liable to discharge service tax on the said activity under the category of "supply of manpower service" on the total consideration received from the sugar factory. Accordingly, notices were issued and demands were confirmed along with interest thereon and penalties were also imposed. Aggrieved by these decisions, the appellants are before us. 3. The common submissions made by the appellants are as follows : 3.1 From the contracts entered into by the various parties involved, it can be easily seen that there is no supply of manpower by the appellants to the sugar factory. The agreement with the sugar factory is for ha....

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.... through the appellants which are essentially trusts/co-operative society of the farmers, has been inexistence for a very long time and is well known to the department. In spite of this knowledge, demands have been issued invoking the extended period of time when there is no suppression on the part of the appellants. Therefore, the demands are also time barred in most of the cases. It is also submitted that the activity of harvesting and transportation of sugarcane would come under the category of "Business Auxiliary Service" (BAS) and this Tribunal in the case of Amrit Sanjivni Sugarcane Transport Co. Pvt. Ltd. v. CCE, Aurangabad vide Order No. A/532/2013/CSTB/C-I, dated 2-4-2013 and Samarth Sevabhavi Trust v. CCE, Aurangabad vide Order No....

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....ory. To undertake that work, they have entered into an agreement with the contractors who have provided the manpower for harvesting of the sugarcane and transportation of the same. In any service activity, manpower is required. That does not make the service as supply of manpower. Otherwise, all services would have to be classified as "manpower supply service". Further in the instant case, the consideration is paid not on the supply of manpower but on the sugarcane supplied on tonnage basis. If an efficient contractor engages less manpower, he will make more profits while an inefficient contractor engaging more manpower would make less profits. In other words, since the consideration is received on the quantity of sugarcane delivered, the e....

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....specified in sub-clauses (i) to (vi), such as billing, issue or collection or recovery of cheques, payments, maintenance of accounts and remittance, inventory management, evaluation or development of prospective customer or vendor, public relation services, management or supervision. Sub-clause (iv) deals with procurement of goods or services, which are inputs for the client. Sugarcane is an input for the client, the sugar factory and the sugarcane are goods. Though the appellants do not procure these goods, they are rendering a service incidental or ancillary to such procurement and therefore, the activity undertaken by the appellants in harvesting and transporting the goods comes under sub-clause (vii) of Section 65(19). Since the impugn....