2014 (12) TMI 547

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....perusal of the records, we find that the appellants are engaged in the process of grinding of wheat into wheat products such as maida, atta, suji and bran for various parties. There is a demand of service tax under the category of Business Auxiliary Service. The dispute relates to whether the process amounts to manufacture. The appellant contended that the conversion of wheat into wheat products involves several process, such as cleaning of impurities, grinding, milling etc. by machines and labour. It is also contended that the process amounts to manufacture under Section 2(f) of the Central Excise Act, 1944. The adjudicating authority held that the activity carried out by the appellant will not amount to manufacture and service tax is levi....

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....nce to agriculture produce. A copy of the comments of CCE Coimbatore sent earlier to ST wing is enclosed for ready reference.              3. CX wing is in agreement with views of CCE Coimbatore that conversion of wheat into products like Flour, Maida, Suji etc. amounts to manufacture as a new commodity with distinct name, character and use emerges from the activity of milling of wheat. In fact, Central Excise duty was imposed on Maida in 1971 which was subsequently withdrawn. At present wheat flour finds a specific mention in Central Excise Tariff under Chapter 11 and carried a NIL rate of duty. 3. The learned AR for Revenue sought time for verification of the Boards letter. To....

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....on this issue has granted stay vide Misc. Order No. 42592/2013 dated 5.11.13. Another O-in-O passed by the Commissioner vide O-in-O No.52/2012 ST dated 11.11.12 in the case of M/s. Rajaram Flour Mills, confirming the demand of Service Tax of Rs. 71,28,671/- with equal penalty and interest is also pending with the Honble CESTAT, SZB, Chennai and a stay order vie Misc. Order No. 40899/2014 dated 12.6.14 has been granted. 5. On an identical issue pertaining to M/s. Naga Ltd. Dindigul, Additional Commissioner of Central Excise, Madurai confirmed the demand of Rs. 48,58,299/- along with interest and penalty vide Order-in-Original No. MAD-CEX-000-ADC 8-12 dated 27.4.2012. On appeal by the assessee, Commissioner (Appeals), Madurai allowed the ap....