2015 (4) TMI 646

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....n No. 50/03-CE. The manufacture of fastners required bright wire rods for which they imported bright bars and sent the same directly to M/s Juneja Bright Steels Pvt. Ltd., Faridabad for conversion into wire rods on job work basis. The bright wire rods made by M/s Juneja Bright Steels Pvt. Ltd. were received back by M/s Sundram Fasteners Ltd. and were used in the manufacture of their finished products. During the period of dispute, M/s Juneja Bright Steels Pvt. Ltd. treating their activity as not amounting to manufacture were paying service tax on job charges, treating their activity as Business Auxiliary Services taxable under Section 65 (105) (zzb) readwith Section 65 (19) of the Finance Act, 1994. Subsequently, the Department was of the v....

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....osit of penalty and stay on its recovery. 2. Heard both the sides in respect of stay application of M/s Sundram Fasteners Ltd. 3. Shri N.K. Sharma, Advocate, the learned Counsel for the appellant, pleaded that M/s Sundram Fasteners Ltd. were sending the imported bright bars directly from the port of importation to M/s Juneja Bright Steels Pvt. Ltd., Faridabad for conversion into bright wire rods on job work basis, that M/s Juneja Bright Steels Pvt. Ltd., treating their activity as Business Auxiliary Services, were paying service tax on the job charges and for this purpose had obtained service tax registration and were also filing ST-3 returns, that the activity of M/s Juneja Bright Steels Pvt. Ltd., Faridabad was, thus, known to the D....

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....or conversion into bright wire rods on job work basis and were receiving the bright wire rods from them. Department does not dispute that M/s Juneja Bright Steels Pvt. Ltd. had obtained service tax registration treating their activity as Business Auxiliary Services, that is production of goods not amounting to manufacture and were paying service tax on the job charges and were also filing ST-3 return. Thus, it cannot be denied that the activity of M/s Juneja Bright Steels Pvt. Ltd. was known to the Department and the Department at that time was accepting the service tax from them. In view of this, just because subsequently the Department takes the view that the activity of M/s Juneja Bright Steels Pvt. Ltd amounts to manufacture and the bri....