TaxTMI 
TaxTMI 
2019 (8) TMI 260
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....irmed and penalty has also been imposed. The period involved in this appeal is from April, 2009 to March, 2013. 2. Service Tax Appeal No. 54396 of 2015 has been filed for setting aside the order dated 31 August, 2015 passed by the Commissioner of Central Excise, Alwar by which the demand has been confirmed and penalty has also been imposed. The period involved in this appeal is from April, 2013 to March, 2014. 3. The issue involved in both the appeals is common and is regarding the applicability of service tax on deputation/ secondment of employees from a group company in Japan to the appellant in India. 4. M/s Mikuni India Private Limited is the appellant in both the appeals. It is engaged in the manufacture of throttle body, carburetto....
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....missioner confirmed the demand by the two orders that have been impugned in the two appeals. 6. The demand was made under "Manpower Supply Services", which upto 30 June 2012 was a taxable service as provided for in Section 65 (68) of the Finance Act, 1994 (hereinafter referred to as the Act) read with Section 65(105)(k). The said Sections are reproduced below:- "65 (68) "manpower recruitment or supply agency" means any person engaged in providing any service, directly or indirectly, in any manner for recruitment or supply of manpower, temporarily or otherwise, to any person 65 (105)(k) - taxable services means any service provided or to be provided to any person, by a manpower recruitment or supply agency in relation to the recruitment....
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....ply Agency Service" to the appellant is incorrect. It is also his submission that even for the period from 1 July, 2012 to 31 March, 2014, no service tax is payable by the appellant on the salaries paid by the appellant to its Japanese employee in India as the definition of "service" under Section 65B (44) excludes provision of service by an employee to an employer in the course of or in relation to his employment. Elaborating his submission, learned Counsel submitted that MCI is engaged in the manufacture of carburettors and not in the business of supply of manpower and, therefore, cannot be treated as a "Manpower Supply Agency" and, therefore, no service tax is payable on transfer of Japanese personnel from MCI to the appellant. Learned C....
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....t whose reporting officer has to be employee of the appellant itself. Appellant only is disbursing the Provident Fund contributions and is also deducting tax at source. These observations are sufficient to corroborate the above observations of the impugned arrangement between the appellant and the Japanese experts to be that of a service and to not to be of manpower supply service. The circular as relied upon by the department is perused to be a draft circular. There is nothing on record about the same being ever notified. Thus, we are of the opinion that the adjudicating authority below has definitely committed an error while relying upon the draft circular. 11. For the period post 1 July, 2012, the Division bench observed: 7. For the p....
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....he employees under the laws of the foreign jurisdiction. There was no basis whatsoever to hold that in such a transaction, a taxable service involving the recruitment or supply of manpower was provided by a manpower recruitment or supply agency. Unless the critical requirements of clause (k) of Section 65(105) are fulfilled, the element of taxability would not arise." 9. The Hon'ble High Court Gujarat in the case of Commissioner of Service Tax Vs. Arvind Mills Ltd. - 2014 (35) STR 496 has held that even if the actual cost incurred by appellant in terms of salary remuneration and perquisites is only reimbursed by group of companies, there remains no element of profit or finance benefit. The arrangement is that of the continuous control and....