TaxTMI 
TaxTMI 
2018 (10) TMI 34
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....t appellants are involved in the activity of 'production of goods on behalf of the clients' on which service tax is required to be paid as per Section 65 (19) (v) of the Finance Act,1994 under the category of 'Business Auxiliary Service'. Appellants were requested to produce certain documents like invoices, bills etc. by HPU unit on 11.9.2006. Accordingly, show cause notice dt. 15.05.2008 was issued to the appellants inter alia, alleging that since activities of 'inspection and packing' and clearance of goods for export under bond done by the principal manufacturer do not amount to fulfilment of conditions of 'use in or in relation to manufacture of other goods' as appearing in the Notification No.8/2005-ST dt. 01.03.2005, the appellants we....
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....reon and also imposed penalty under Section 76 of the Act ibid. On appeal, the Commissioner (Appeals) vide an Order No.71/2010-ST dt.25.08.2010 upheld the order of original authority and rejected the appeal. Hence appeal ST/676/2010 by the appellant. 3. Today when the matter came up for hearing, on behalf of the appellant, Ld. Advocate Ms. S. Sridevi made oral and written submissions which can be broadly summarized as under : i. The term 'business auxiliary service' specifically excluded activities amounting to 'manufacture' as per Sec.2 (f) of Central Excise Act, 1944, from the scope of levy. In appellants case, the rough casting received from M/s.Magna Castings would be subjected to various processes, such as maching, drilling tapping ....
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.... para 6.4 of the appeal memorandum, which may be taken up for consideration. v. The appellant submits that the goods received from the principal manufacturer were under job work challan and the principal manufacturer vide their letter dated 10.03.2005 clearly admitted that these goods were used in relation to manufacture of final products by them and the finished goods are cleared either for export under bond or domestic purpose on payment of appropriate duty. Further, the appellants also claimed benefit of Notification No.8/2005 and filed ST 3 returns intimated such availment of notification. Hence, no suppression can be attributed against the appellants. 4. On the other hand, Ld. A.R Shri A.Cletus supports the impugned orders. He point....
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....the first return on 24.10.2006 claiming exemption under Notification No.8/2005-ST dt.01.03.2005. The main ground for initiation of the proceedings against the appellant in both the SCNs is that their client Magna Electro Castings Ltd. were not using the returned goods 'in the manufacture of final products' but were exporting the goods as such. At the same time, nothing is forthcoming from the notices as to whether any SCN has been issued to Magna Electro Castings Ltd. in this regard and whether such proceedings have culminated in a finding that in fact no manufacturing activity is being carried out by them. In the circumstances, we are of the considered opinion that mere allegation against Magna Electro Castings Ltd., that too in passing, i....