TaxTMI 
TaxTMI 
2018 (8) TMI 253
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....ate, Ms.Malvika Bhanot, Advocate for Parekh & Co. For the Respondent : Mr.Sanjay Jain, D.R. & Mr. G.R. Singh, D.R. ORDER Per : Rachna Gupta Present order disposes of several appeals as detailed below being filed by the respective appellant being aggrieved by the respective orders as detailed below. All these appeals are taken together because of the question for consideration for them being similar. Hence, all are disposed of by the present common order. 2. The facts found in these appeals as relevant for present adjudication are as follows:- 2.1 That the appellants herein are the house labour contractors of M/s. Larsen & Toubro Ltd. (L & for short) who is the principal manufacturer of transmission towers and is getting one or the other job work for the purpose from all the appellants. On an intelligence being gathered by the Department, the Regional Unit of Indore, it was alleged that the appellants are performing such activities for the L & T which falls under the definition of Business Auxiliary Services against the charges received for the purpose. However, they are not paying the due Service Tax on the gross amount received by them from L & T. They deliberate....
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....tching tower parts, rework of tower parts include-ing welding, grind-ing, marking, punching/drilling and getting inspect- ion through QC. 29.03.12 06/02/2013 ST/57437/2013-DB Paramjeet Singh 22.03.11 01.04.06 to 31.12.10 Processing of goods involving the activity of materials, loading at steel yards, unloading of receipt materials at steel yards, straightening of material, cylinder receipt & stacking, identifying the materials as per indent, removing the same from stack lifting, moving to shop floor and placing the material near to respective machine sequentially/ priority wise, wire receipt and stacking, on the raw materials/ inputs, etc. etc. 29.03.12 06/02/2013 ST/52593/2014-DB C P Moury 22.03.11 01.10.06 to 31.12.10 Fabrication of tower parts including shearing, cutting, punching, numbering, notching, marking, drilling debarring and getting inspected through QA. 16.03.12 28/01/2014 ST/50101/2015-DB C P Mourya 18.04.12 01.01.11 to 31.03.12 Fabrication of tower parts including shearing, cutting, punching, numbering, notching, marking, drilling debarring and getting inspected through QA. 30.08.13 24/09/2014 ST....
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....g shearing, cutting, punching, numbering, notching, marking, drilling debarring and getting inspected through QA. 05.02.14 14/10/2014 ST/50327/2015-DB Paramjeet Singh 16.09.13 01.01.11 to 31.03.13 Fabrication of tower parts including shearing, cutting, punching, numbering, notching, marking, drilling debarring and getting inspected through QA. 17.02.14 14/10/2014 ST/50328/2015-DB Anil Kumar 14.08.13 01.04.11 to 31.03.13 Fabrication of tower parts including shearing, cutting, punching, numbering, notching, marking, drilling debarring and getting inspected through QA. 12.02.14 14/10/2014 ST/50329/2015-DB Meena Industries 03.10.12 01.04.11 to 31.03.13 Fabrication of tower parts including shearing, cutting, punching, numbering, notching, marking, drilling debarring and getting inspected through QA. 17.02.14 14/10/2014 ST/50382/2015-DB Majister Singh 16.09.13 01.04.11 to 31.03.13 Fabrication of tower parts including shearing, cutting, punching, numbering, notching, marking, drilling debarring and getting inspected through QA. 14.02.14 14/10/2014 ST/50325/2015 Bir Bahadur Yadav 18.04.2012 ....
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....Appeals), where appellants were found to engage in the work of cutting of angles (to size), drilling, Punching, bending stamping etc. as instructed by L & T. They are getting paid on the quantum of work done on M.T. basis and not on the basis of workers employed or on commission basis. Also since no new product emerges in the process, these activities do not amount to manufacture. But are the activities in clause 5 of definition of Business Auxiliary Service in Section 65 (19) of the Finance Act. Any alleged infirmity in the order is vehemently denied and appeals are prayed to be rejected. 6.1 In support of his argument ld. DR relied upon the following case laws:- 1. CCE, Bangalore-II vs. Osnar Chemical Pvt. Ltd. - 2012 (276) ELT 162 (SC) 2. Haryana State Electricity Board, Steel STR.FAB. Workshop vs. ACC & CE - 2008 (221) ELT 198 ( P & H) 3. Collector of C. Ex., Jaipur vs. Pratap Rajasthan Special Steel Ltd. - 1999 (108) ELT 437 (Tri.) 4. PSL Ltd. vs. CCE, Rajkot - 2009 (16) S.T.R. 247 (Tri. - Ahmd.) 5. CCE , Chennai-II vs. Tarpaulin International - 2010 (256) ELT 481 (SC) 6. Orient Packaging Ltd. vs. CCE, Meerut-I - 2011 (2....
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....ing of the expression 'manufacture' but is an expansive definition. It was also held that one of the main tests ... is whether on account of processes employed or applied by the assessee, the commodity so obtained is no longer regarded as the original commodity but is, instead, recognised as a distinct and new article that has emerged as a result of the processes. (ii) Brakes India Limited vs. Superintendent of Central Excise and Others reported in 1997 (10) SCC 717 at paras 1 and 2 page 717 wherein it was held by the Hon'ble Supreme Court that if by a process, a change is effected in a product, which was not there previously, and which change facilitates the utility of the product for which it is meant, then the process is not a simple process, but a process ancilliary to the completion of a manufactured product. It was also held that when adopting a particular process, if a transformation takes place, which makes the product have a character and use of its own, which it did not bear earlier, then the process would amount to "manufacture"." 8. Now coming to the authority as is relied upon by the appellant i.e. Mahindra & Mahindra (supra), it is observed that finding of....
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....dity. Thus, making of porta cabin from iron and steel angles with, roof frame-work i.e. trusses, doors, windows, ladders in it made by drilling holes and cutting the raw material, will be a movable structure having identity as a distinct marketable commodity. When the porta cabin is dismantled it nonetheless remains the manufactured products i.e. porta cabin dismantled or disassembled. The material such as angles, rods, shades, sections plates, tubes, etc. of such designed structure in their pre- assembled or disassembled form are prepared for use in the said structure, namely porta cabin. One cannot, with any conviction or authority, say that these dismantled parts of the structures are raw material used in its original form and that mere cutting or drilling holes has made no difference. The items in the parenthesis of Heading 7308 described as excisable goods include roofs, roofing frame-work, doors, windows and their frames, thresholds for doors, shutters, pillars, column, balustrades pillars, sheets of iron and steel, each one of these items has a complete distinct identity. The contractor undertaking the works contract for erecting a structure may not himself manufacture all s....
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....o be customised into a particular shape and size, even in terms of the location of hole/punch there upon, to suite the design, specification of the final product that is the transmission tower in hand. It has well been clarified by various judgements as discussed above i.e. Mahindra and Mahindra (supra) and Brakes India Limited vs. Superintendent of Central Excise and Others (supra) that the activity bringing a change to a raw material, howsoever simple as that of cutting or drilling, that too such a shape, size or structure that it is no more in the original form of its raw-material and cannot be used for any other purpose except for the final product for which it has been so customised. 10. The another peculiar fact of the present case which distinguishes it from the case law as relied upon by the Department is that the final product here is a transmission tower, which is to be removed from the premises of L & T in CKD condition only i.e. all such parts as processed by the appellants herein shall be cleared from L & T premises in unassembled form, though together, to be finally assembled at the site of the client in the form of a transmission tower. Thus, it become clear that ....