TaxTMI 
TaxTMI 
2018 (9) TMI 1848
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....documents. 3. On scrutining the documents it was found that the agreement entered into between respondent No. 2 and M/s. Emox Device Compamy to whom services were being rendered by respondent No. 2 was for supply of manpower came within the ambit of "Manpower Recruitment & Supply Agency" defined under Section 65(68) of the Finance Act 1994 on which service was leviable with effect from 16. 06. 2005. "68. manpower recuritment or supply agency" menas any commercial concern engaged in providing any service, directly or inderectly, in any manner for recruitment or supply of manpower, temporarily or otherwise, to a client;". 4. Show cause notice dated 13. 08. 2010 was issued by the Office of the Commissiner, Centeral Excise,Puducherry Commissionerate, Goubert Avenue, Beach Road, Puducherry - 605 001 as to why:- "a. An amount of Rs. 34,94,061/- (Rupees Thirty four lakhs ninety four thousand sixty one only), being the Service Tax including Edu. Cess & SHE Cess payable the taxable services rendered by them as "Man Power Supply Agnecy" to M/s. Mox Device Co. , Kattukuppam, Puducherry for the period from June 2005 November 2009 should not be demanded under provi....
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....cruitment and Supply Agnency's Service". d. Penalty under Section 77 of the Finance Act,1994 as amended should not be imposed on them for non-finling of returns as per the provisions of Section 70 of the Finance Act, 1994 and failed to obtain registration under Section 69 of the Finance Act, 1994;" 6. Respondent No. 2 gave a reply on 09. 10. 2010 and contended that they have entered into an agreement with M/s. Emox Device Compamy (EMD in short) to supply manpower for packing, gardening, cleaning, materials movements from trucks to stores, stores to production area and finished goods from finished goods area to vehicles and therefore, the activity carried out by them should be considered as one amounting to manufacture which is excluded from levy of service tax. It was stated that under the terms of the agreement they have to provide these men who were technically competent to carry out the various activities and that therefore the activities carried out by them would come within the definition of manufacture. 7. The Additional Commissioner after considering the reply confirmed the demand of service tax and also imposed penalty leviable under the Finance Act, 1994....
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....ext contention of the appellants is that the amount paid by the service receiver should be considered as cum-tax payment and service tax shold be calculated accordingly. Accoring to Section 12A of the Central Excise Act,1944 which has been made applicable to service tax mattters by virtue of Section 83 of the Finance Act,1994, the amount of service tax should be shown separately in all the documents relating to assessment, bills, invoices, etc. In case the amount of service tax is not shown separately in the bill, the gross amount shown in the bill shall be taken as inclusive of service tax. This fact has been further validated after the insertion of Explanation 2 in Section 67 with effect from 10. 09. 2004. Thus, where in the bill, a service provider indicates only the gross amount charged which includes both value of taxable services and the service tax payable thereon, the value off the taxable service shall be such amount as with addition of tax payable is equal to the gross amount indicated in the bill. In other words, the value of taxable service will be determined with the help of back calculations as is done in the case of cum-tax price. In the present case, the appellants ....
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....ctually provided by the assessee. Whether mere supply of labour was the activity or that was followed by any further activity of unloading, staking and packing could have been examined which goes to the root of the matter. 6. For no well founded show-cause notice, there shall be waiver of penalty imposed under Section 76 and 78 of the Act. But penalty imposed under Section 77(1) shall continue. To this extent, adjudication is restored modifying the order of learned Commissioner (Appeals). " 12. It is this order that is challenged in the present appeal on the following substantial questions of law. " (i) Whether the reasoning of the Tribunal (para 5) to sustain the order of the Commissioner (Appeals) deleting the penalty was justified when the Show casue notice was issued only upon the perusal of all records and Annexures-I more so in view of the findings of the Commissioner (Appeals) (paras 8 to 10) (ii) Whether the Tribunal was empowered to sustain the order of Commissioner (Appeals ) deleting penalty which is automataic in view of the specific finding given by the adjudicating authority in the show cause notice. (iii) Whether in the facts an....
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....e tax so not levied or paid or short-levied or short-paid or erroneously refunded:] 1[Provided that where such service tax as determined under sub-section (2) of section 73, and the interest payable thereon under section 75, is paid within thirty days from the date of communication of order of the 2[Central Excise Officer] determining such service tax, the amount of penalty liable to be paid by such person under this section shall be twenty-five per cent. of the service tax so determined : Provided further that the benefit of reduced penalty under the first proviso shall be available only if the amount of penalty so determined has also been paid within the period of thirty days referred to in that proviso : Provided also that where the service tax determined to be payable is reduced or increased by the Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the court, then, for the purposes of this section, the service tax as reduced or increased, as the case may be, shall be taken into account : Provided also that in case where the service tax determined to be payable is increased by the Commissioner (Appeals), the Appellate Tribunal or, as the case may be, the cour....
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....equirements concerning the conditions of service and wages. . . , (iv) agrees to provide wherever applicable and needed at his cost, uniforms, coats and shoes to the workers engaged by him. . , (v) be wholly responsible for the overall safety of the workmen. . , (vi) indemnify and keep the company indemnified against acts or omission or negligence, dishonesty or misconduct of the men engaged. . , (vii) will at all times indemnify the company against any claim which could arise under Workmen Compensation Act, 1953. . , (viii) in the event of Contract Labour (Regulation and Abolition) Act, 1970 being applicable. . . forthwith take out necessary licence., (ix) discharge all liabilities like salaries, wages and other statutory obligation in respect of the person engaged by the contractor. , (x) for the purpose of ESI & PF, submit the details of Wages by him to his employees. . , (xi) that this agreement will cease to be in force if the Government issues any notification proposing prohibition of employment of Contract labour under the Contractor Labour (Regulation & Abolition ) Act, 1970 or any other Act prohibiting....
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....ncillary to the completion of a manufactured product; (ii) which is specified in relation to any goods in the Section or Chapter Notes of the First Schedule to the Central Excise Tariff act, 1985 ( 5 of 1986) as amounting to manufacture; or (iii) Which, in relation to the goods specified in the Third Schedule, involves packing or repacking of such goods in a unit container or labelling or re-labelling of containers including the declaration or alternation of retail sale price on it or adoption of any other treatement on the goods to render the product marketable to the consumer, and the word " manufacture" shall be construed accordingly and shall include not only a person who employs hired labour in the production or manufacture of excisable goods, but also any person who engages in their production or manufacutre on his own account;" 20. A process is a manufacturing process that it brings out a complete transformation for the whole components so as to produce a commercial diffferent article of commodity. Though it is well settled that the process itself may consist of several processes which may or may not bring about any agency at intermediate stage, but the ....