TaxTMI 
TaxTMI 
TaxTMI 
2015 (3) TMI 43
X X X X Extracts X X X X
X X X X Extracts X X X X
....ict, is a private limited company whose share holders are mainly farmers. They entered into an agreement with M/s. Kukadi SSK Ltd., for harvesting of sugar cane at the fields of member-farmers and transporting the same to Kukadi SSK Ltd.'s, Shrigonda, Ahmednagar District. Remuneration for harvesting and transportation was paid on a tonnage basis i.e., per tone of the sugar cane delivered at the factory. The department was of the view that the act of providing harvesting sugar cane and transporting the harvested sugar cane from the farmers' fields to the factory site is classifiable as'manpower recruitment or supply agency service' and is chargeable to service tax. Accordingly, a show cause notice dated 13/5/2008 was issued t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....factory. For that purpose, the appellant avails services of various contractors who supply labour for harvesting and for transportation. The appellant-company is coordinating between the sugar factory and the labour contractors, for which they receive consideration from the sugar factory towards supervision charges and they discharge service tax liability thereon under the head'Business Auxiliary Service'. For supply or transportation by means of truck/tractors, etc., the sugar factory pays freight and service tax thereon, whereas for harvesting of sugar cane, the appellant pays to the contractor harvesting charges which they get reimbursed from the sugar factory at actual. The activity undertaken by the appellant is harvesting of s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sioner of Central Excise (Appeals) held that since the appellant is paid by the sugar factory on tonnage basis, of the sugar cane delivered, irrespective of the number of labour employed and number of vehicles used for transportation; therefore the service rendered cannot be classified under the category of'Manpower Recruitment or Supply Agency service' and had accordingly dropped the demand. The appellant also relies on Final Order No. A/532/13/CSTB/C-I dated 02.04.2013, wherein under similar circumstances the co-ordinate bench of this Tribunal (of which, I was also a member) have held in favour of assessee that there is no element of'Manpower Recruitment or Supply Agency Service'. In view of the above, it is pleaded that t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....' fields to the sugar factory and, therefore, even if the charges are paid on tonnage basis, it is in respect of supply of labour that the charges have been paid. Accordingly, he submits that the impugned order classifying the services rendered under the category of'manpower recruitment or supply agency service' is sustainable in law and he accordingly pleads for dismissing the appeal. 5. We have carefully considered the submissions made by both the sides. We have also perused the agreements entered into between various parties which are available on record. 5.1. From the agreement entered into between the farmer and the sugar factory, the farmer has undertaken to supply sugar cane grown by him in his field to the sugar factor....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ransportation of sugar cane through trucks/tractors and bullock carts shall be on the sugar factory. The appellant's responsibility is of assisting in the programme of cutting and inspection for which the appellant receives supervision charges. The rates for sugar cane cutting and transportation are fixed on tonnage basis and rates are fixed independently for various activities such as (i) tying bundle by cutting and slicing sugar cane and (ii) sugar cane transportation by various modes such as bullock-carts, trucks/tractor, labourers (head loads). From these agreements what is evident is that there is no supply of any labour by the appellant to the sugar factory. They are only facilitators between the farmers and the sugar factory. The....