TaxTMI 
TaxTMI 
2022 (8) TMI 646
X X X X Extracts X X X X
X X X X Extracts X X X X
....leged that supply and use of explosive to buyers at their side is amount to provision of service and the appellant has provided the taxable service of 'site formation, clearance, excavation, earth moving and demolition' services without obtaining Service Tax registration and not paid Service Tax. During initial statements of Shri Milesh D. Joshi, partner of appellant recorded under Section 14 of the Central Excise Act, 1994. On the basis of the said statements the Revenue's allegation is that appellant was providing blasting material such as Nitrate Mixtures, Detonators, Fuses, etc., to various clients on site through their certified vehicles for transport of explosives, along with trained and certified employees who were termed as 'shot- firer' who performed blasts at the site, by using the said explosives. The adjudicating Authority passed order in original wherein it was held that the appellant has provided services of 'site formation, clearance, excavation, earth moving and demolition' and consequently confirmed the demand of Service Tax, imposed penalty and demand of interest. Being aggrieved by the orders in original appellant filed the present appeals. 2. Shri....
X X X X Extracts X X X X
X X X X Extracts X X X X
....y and goods, the activity is otherwise deemed sale, hence in terms of Section 65B(44) (a)(ii), the activities of the appellant is not service and the same is not liable for Service Tax. He further submits that as per Rule 2A of Service Tax (Determination of Value)Rules 2006 before or after 01.07.2012, value of goods was not to be included in the value of taxable service. In this case the entire amount collected to the appellant from their buyers of explosives is against sale of goods which has been considered for demand of Service Tax and as such entire amount was to be deducted for calculating value for Service Tax. Receipt of sale proceeds of goods from buyers was not taxable, which is decided in the case of Intercontinental Consultants And Techno crafts Pvt. Ltd by the Hon'ble Supreme Court as reported in 2018 (10)G.S.T.L 401(S.C). In case of the appellant, the entire value is for sale of the goods and not for any taxable services. He submits that the entire case was made on the basis of statements of one partner. He submits that the statement dated 02.06.2015 is not correctly or factually recorded and the same is not corroborated by any clinching positive evidences. He submits ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....od. This onus has not been discharged by investigating agency. Show Cause Notice presumed entire receipt as consideration of taxable services which is against the principal of law settled by the Hon'ble Supreme Court in case of Larsen and Tourbo as reported in 2014 (303) ELT 3 (SC). Show Cause Notice suffer from incurable deficiency on taxability of service and computation of Service Tax. Therefore, the impugned orders are liable to be set aside, in the facts of these appeals. In support he placed reliance on the following judgments: • United Telecom 2011 (22) STR 571 (Tri. Bang) • Swapnil Asnodkar 2018 (10) GSTL 479 (Tri. Mumbai) • Balaji Enterprises 2020 (33) GSTL 97 (Tri. Del) • ITC Ltd. 2014 (33) STR 67 (Tri. Del) • Kafila Hospitality & Travels Pvt. Ltd. Vs. CST- 2021 (47) G.S.T.L. 140 (Tri. LB) 2.2 He submits that the demand of Service Tax is based on the definition of service existed prior to 01.07.2012. However, period of dispute in present case is also falling on or after 01.07.2012. The demand of Service Tax on definition based in erstwhile regime cannot be confirmed. Show Cause Notice has failed to analys....
X X X X Extracts X X X X
X X X X Extracts X X X X
....appellant and they had carried out the blasting operations on behalf of buyers of appellant and received payments/consideration from the buyers. The buyers of appellant had engaged qualified persons as "Shot Firers" as per Rule 2(51) of Explosive Rules, 2008; that such "Shot firers" were separately recognised and certified persons under the Explosive Rules, 2008. Thus, appellant was not providing any service to its clients/customers after carrying Explosive in its vehicle.Sales invoices/evidences support this fact.He submits that the activity in Trading of Explosive are under Section 66D (e) of the Finance Act,1994 not attracting Services Tax liability after July, 2012. Therefore, the question of demand of Service Tax in sale of explosive is not in accordance with law and deserves to be set aside. He further submits that this Tribunal being a final fact finding authority can very well admit fresh evidence and argument. In this regard he take support from Hon'ble Supreme Court judgment in the case of National Thermal Power Co. Ltd. Vs. Commissioner of Income Tax reported in 1998 (99) ELT 200 (S.C). He also relied upon the following judgments: • Devangere Cotton Mills Lt....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... (1) Licence for sale of Explosives. (2) Representative purchase Invoices of Explosives by the appellant (3) Representative Sales Invoices Showing Sale of Explosives (4) Profit and loss account (5) List of sale of goods in terms of sub Rule (2) of Rule 19 of Explosive Rules in form 201 A (6) VAT registration issued by Government of Gujarat. (7) VAT payment challanfor sales (8) VAT returns for period upto 30.06.2017. On going through the above documents, it is absolutely clear that the entire activity of the appellant is sale of Explosives. we observed that the revenue has demanded the Service Tax on the total invoice value which is of sale invoice and it is issued against sale of the explosives. No bifurcation was provided in the invoice such as sale of goods and service charge. With this undisputed fact it is clear that the appellant have raised the invoices for the entire value only for sale of goods on the total sale value. The appellant have discharged the VAT on actual sale value of goods and not even on composition scheme like Works Contract Tax (WCT). The appellant have paid the entire VAT to the State....
X X X X Extracts X X X X
X X X X Extracts X X X X
....refore, there is no iotl of doubt that appellant's activity is only of sale and no service was involved. The contention of the revenue is based on the fact that the appellant have supplied the explosives in their own vehicle and the same was delivered at site. The goods were meant for blast at the particular place where the blasting was to be carried out. Therefore, the appellant have not only supplied the explosive but also carried out the blasting. Therefore, the revenue's contention is that the appellant have provided the service of 'site formation, clearance, excavation, earth moving and demolition'. In this regard we find that since the appellant have raised the said invoice towards the supply of explosives and paid the VAT on the entire amount and no extra consideration towards the service was recovered the entire value recovered by the appellant from their client is indeed a sale value. Hence, no amount towards the service charge was recovered, therefore even if some incidental activity was carried out by the appellant, the overall transaction cannot be taken away from the transaction of sales in terms of sale or goods act. We further find that the revenue has heavily relied....
X X X X Extracts X X X X
X X X X Extracts X X X X
....laim. From the above definition of Service it can be seen that any activity carried out by a person for another for consideration and includes a declared service is defined as "service". As per sub clause (a) (i) of section 65 (B) (44) activity of a transfer of title in goods by way of sale gift or in any manner is not included in the transfer "Service." Accordingly, in the present case the activity being of "sale of goods" does not fall under activity of any "Service". Moreover, there is a negative list of service under Section 66D, wherein one service is specified under Clause "(e) trading of goods". From this activity under negative list the "trading of goods". The same is being listed under negative list of services is not leviable to Service Tax. Therefore, the appellant's activity which is undoubtedly falling into the activity of trading is not liable to Service Tax. Without prejudice, we also find that even if it is assumed that the appellant's activity is a composite works contract service but the facts remains, the appellant have paid VAT on the entire value, the same should be treated as a deemed sale. In terms of Section 65B(44) (a)( ii) an activity which constitutes ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....shaving and cleaning, and oil is applied to the scalp to rid it of dryness. A mud pack may be applied to rid it of excess sweat glands. (e) The head is then washed, conditioned and sterilized with dettolThe wig is thereafter pasted onto the head with medical tape and glue and the hair on the wig is cut so as to match the existing hair style. (f) The wig is also maintained, if the client so desires, and re-groomed either fully ie. by removal of wig, sterilization, cleaning of the scalp and replacing the wig or partly i.e. washing and tightening the loose ends." In the above though the activities involved is preparation of wig and various other activities and fixing of wig on the scalp of the human being. Since the entire activity was subjected to payment of VAT, the Hon'ble Court held that the activity of the assessee is of sale and not amount to service. Applying the ration of the above decision of the Hon'ble Madras High Court, the present case is on better footing as the pre-dominant portion is the sale of explosives and very minuscule activity such as placing the explosive in the holes and blasting(even though the same was not carried out by the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....roceeding. In this position we are of the clear view that even the version of the statement of the partner being contrary to the documentary evidences. It was incumbent on the Adjudicating Authority to cross examine the witness Shri Milesh Joshi partner in terms of Section 9D of the Central Excise Act, which reads as under: 1[9D. Relevancy of statements under certain circumstances.- (1) A statement made and signed by a person before any Central Excise Officer of a gazetted rank during the course of any inquiry or proceeding under this Act shall be relevant, for the purpose of proving, in any prosecution for an offence under this Act, the truth of the facts which it contains,- (a) when the person who made the statement is dead or cannot be found, or is incapable of giving evidence, or is kept out of the way by the adverse party, or whose presence cannot be obtained without an amount of delay or expense which, under the circumstances of the case, the Court considers unreasonable; or (b) when the person who made the statement is examined as a witness in the case before the Court and the Court is of opinion that, having regard to the circumstances of....
X X X X Extracts X X X X
X X X X Extracts X X X X
....allowed cross examination of witness. Therefore, demand of service tax on the basis of such statements not sustainable. Adjudicating Revenue Authority has not Examined and allowed Cross Examination of shri Milesh Joshi partner u/s 9D of Central Excise Act 1944. In absence of such Cross Examination, statements taken and used against appellant to raise the Service Tax demand have to be discarded in terms of section 9D and decisions. Thus, by not allowing Examination and Cross Examination of witness u/s 9D of Central Excise Act 1944, the adjudicating authority has destroyed case of Revenue. The entire case of Revenue has been vitiated in these proceedings, making the Service Tax demand unsustainable for violation of the Principles of Natural Justice. Except statements of Partner shri Milesh D. Joshi (witnesse), there is nothing on record to establish case of Revenue. Thus, when Adjudicating Authority has neither examined partner Milesh Joshi u/s 9D ibid nor allowed his cross examination, then, all such statements need not be considered as valid evidences and consequently, Service Tax demands based thereon deserves to be dropped in facts of the cases. 4.5 This Hon'ble Tribunal a....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ety Fuse 3. Detonating Fuse 4. Electric and/or Ordinary Detonators Class & Division Sub-division (If any) 2,0 0 Quantity at any one time 1900 Kg 6.1 0 20000 Mirs 6,2 0 10000 Mtrs 6,3 0 44000 Nos (b) Quantity of explosives to be purchased in a calendar month applicable for licence under art 3(b) and (c)] 3 times as above. 5. The licensed premises shall conform to the following drawing(s). Driving No: E/WC/GJ/21/319(E23410) dated: 20/07/2004 6 The licensed premises are situated at following address Survey No(s). 375 Paiky Village Dhunda Taluka Morbi Police Station Morbi PinCode: Phon District: RAJKOT E-Mail: State: Gujarat Fax 7. The licensed premises consist of following facilities: A Main Magazine Lobby and a Detonators Room The licence is granted subject to the provision of Explosives Act 1884 as amended from time to time and the Explosives Rules, 2008 framed there under and the conditions, additional conditio and the following Annexures (1) Drawings (showing site, constructional and other details) as stated in serial No 5 above (2) Conditions and Additional C....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Mtr.) Rs. Total 299001 Vat. % 3892 Add. Tax:...% दà¥à¤°à¤¾à¤¨ દીપકી હતà«àª¤àª° પાસ 2117401 Grand Total 35401 Bsadeja For, M/s. Sardar Trading Co. Document 4 26 TRADING, PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED ON MARCH PARTICULARS I DIRECT INCOME 31, 2011 Sales Closing Stock (As taken, valued & Certified by Partner) TOTAL (1) II DIRECT EXPENSES Opening Stock Purchases Other Exps GROSS PROFIT TOTAL (II) III INDIRECT INCOME GROSS PROFIT Other Income IV INDIRECT EXPENDITURE Adm. expenditures Depreciation Bank interest Interest to Others TOTAL (IV) V NET PROFIT/(LOSS) BEFORE INTEREST & REMUNERATION TO PARTNERS LESS- Interest to partners Remuneration to partners VI NET PROFIT (LOSS) TRANSFER TO PARTNERS' CAPITAL ACCOUNT SCH. DD (Amount in Rs.). 2010-11 26,384,992 4,368,288 30,753,280 3,616,100 26,584,1111 76 552,993 30,753,280 552,993 0 552,993 218.662 76,227 5.969 0 300,858 [(III)-(IV)] 252,135 67.247 123.420 ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....«€àª– 5/09/1984 ૨. વેપારીના ધંધાનà«àª‚ મà«àª–à«àª¯ સà«àª¥àª³-સરનામà«àª‚ મATAPGA CHAMBERS SHANALA ROAD BY: PS, FO:MRBI શહેર MORB•3616/1 છેલà«àª²à«‹ à«©. ધંધાનો પà«àª°àª•àª¾àª° : Railer,ork holors/vt ૪. વધારાના સà«àª¥àª³àª¨à«€ સંખà«àª¯àª¾ (જà«àª“ àªàª¨àª¾àª°) સીલ ઃ સà«àª¥àª³ : તારીખ : #21/4/ Lawn to E Gujarat Bates Par રાહી : હોદો : ગà«àªµà«‡ છે. નિયમો ૧૯à«à«¯ ના નિયમ-૧૦ મà«àªœàª¬ આ નોંધ પà«àª°àª®àª¾àª£àªªàª¤à«àª° વૈપારીઠàª....
X X X X Extracts X X X X
X X X X Extracts X X X X
....AT Form2018 Print Home Document 9 REN 46 à¤à¤¾à¤°à¤¤à¥€à¤¯ गैर नà¥à¤¯à¤¾à¤¯à¤¿à¤• urveda बीस रà¥à¤ªà¤¯à¥‡ 5.20 RTGS TUR INDIA T 339148 Rs.20 TWENTY RUPEES INDIA NON JUDICIAL A HALVAD ADIYA અનà«àª•à«àª°àª® | નંબર જો લોટ - GUJ/ખરીદનારનà«àª‚ નામ 1 GUJARAT Regd.-- TR/***|| 2690 4 રહેવાસી ' સà«àªŸà«‡àª®à«àªªàª¨à«€ કિંમત રૂા. àªàª°àª¾ Diabety 2}}} સાળૠતડ 48AA 55192 लटतलाही लगदानलाई सर àªàª°àª¤àªàª¾àªˆ ગળાઈ નવિન સી, રાજારા સà«àªŸà«‡àª®à«àªª વેનà«àª¡àª° - à....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... પà«àª°àª•àª¾àª°àª¨à«‹ પગાર, મહેનતાણà«àª‚ કે કમીશન આપતી નથી કે હà«àª‚ તેનો કરà«àª®àªšàª¾àª°à«€ પણ નથી. જયારે કોઈપણ ગà«àª°àª¾àª¹àª• મેસરà«àª¸ સરદાર ટà«àª°à«‡àª¡à«€àª‚ગ કંપની પાસે જાદà«àª¸àªªà«àª²à«‹àªà«€àªµ લેવા આવે તà«àª¯àª¾àª°à«‡ જે તે વà«àª¯àª•à«àª¤àª¿ અમને બà«àª²àª¾àª¸à«àªŸàª¿àª‚ગ માટે સંપરà«àª• કરે છે અને અમારે તà«àª¯àª¾àª‚ àªàª....