TaxTMI 
TaxTMI 
2022 (12) TMI 468
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....nt and Supply Agency Services', accordingly the service tax demand was confirmed. Being aggrieved, the appellant filed the present appeals. 2. Shri K.J. Kinariwala, learned Consultant appearing on behalf of the appellant M/s. Talala Taluka Sahakari Khand Udyog Mandali Limited, submits that there is no arrangement for supply of manpower for harvesting and transportation whereas the contract was for harvesting and transportation of sugarcane and the charges for such activities is per ton basis. The farmers are not concerned with number of manpower, man-days, or man-hours for making payment and the charges are made per-ton of sugarcane basis. Therefore, there is no supply of man power. He placed reliance of the following judgments:- (a) 2014 (36) STR 123 (Tri. Mumbai) - Satara Sahakari Shetu Audyogik Oos Todani Vahtook Society vs. CCE, Kolhapur. (b) 2016 (41) STR 806 (Bom) - CC, C.Ex & ST, Aurangabad vs. Shri Samarth Sevabhavi Trust. (c) 2013 (31) STR 611 (Tri. Mumbai) - Seven Hills Construction vs. CST, Nagpur. (d) 2010 (18) STR 17 (Tri. Bang.) - Ritesh Enterprises vs. CCE, Bangalore. He further submits that in the appellant's own case, for t....
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....anstha the charges of cane cutting and transportation on fortnightly basis. 3. The rates for sugarcane cutting and transportation are decided by the State Govt. and the Karkhana will pay the charges (worked out on the basis of the said rates) to the Sanstha on fortnightly basis. 4. The commission/incentive payable to the contractors will be handed over by Karkhana to the Sanstha which further has to be paid by Sanstha. 5. Karkhana will not be responsible for the injury if any, caused to any cane cutting labourer while doing the cane cutting. 6. For arranging the cane cutting and transportation, the Karkhana will pay the consideration to the Sanstha as and when demanded by the Sanstha. 7. The Sanstha also will carry out the jobs of handling of sugar, feeding of sugarcane in the sugar mill, cleaning of parking yard of vehicles transporting sugarcane, loading/unloading/handling of pressmud, baling of bagasse, handling of loose bagasse, collecting/removing/disposal of boiler ash, supply of wood for burning into the boiler, handling/stacking of compost, disposal of spentwash by spraying on the pressmud, stitching of sugar bags. The rates for ....
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.... contract ought to be ascertained only from the terms and conditions thereof. Neither the nomenclature of the document nor any particular activity undertaken by the parties to the contract would be decisive." If we apply the ratio of the above decision to the facts of the case before us and to the contracts entered into by the appellant-assessees with the sugar factory, the tenor of the agreement is for the specific tasks of "harvesting of sugarcane and transportation of the same from the farmers' fields to the sugar factory". The agreement is not for supply of any manpower to the sugar factory. The consideration paid also has no nexus to the manpower employed. 5.3 As per Section 65(68) of Finance Act, 1994 ' "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 other person' and the taxable service is defined under Section 65(105)(k) as "service rendered to any person by a manpower recruitment or supply agency in relation to the recruitment or supply of manpower, temporarily or otherwise, in any manner". The appellants ....
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....ch are inputs for the client; or (v) production or processing of goods for, or on behalf of, the client; or (vi) provision of service on behalf of the client; or (vii) a service incidental or auxiliary to any activity specified in sub-clauses (i) to (vi), such as billing, issue or collection or recovery of cheques, payments, maintenance of accounts and remittance, inventory management, evaluation or development of prospective customer or vendor, public relation services, management or supervision. Sub-clause (iv) deals with procurement of goods or services, which are inputs for the client. Sugarcane is an input for the client, the sugar factory, and sugarcane is 'goods'. Though the appellants do not procure these goods, they are rendering a service incidental or ancillary to such procurement and therefore, the activity undertaken by the appellants in harvesting and transporting the goods comes under sub-clause (vii) of Section 65(19). Since the impugned demands have been raised under the category of manpower supply or recruitment agency services, such demands have no legal basis. 5.5 In respect of the appeals filed by the Revenue, the lower appel....
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....issed as devoid of merits and the appeals filed by the appellant-assessees are allowed, with consequential relief, if any, in accordance with law." (b) CCE&ST, Aurangabad vs. Samarth Sevabhavi Trust "5. The question between the parties is whether the services would fall within the definition of "Manpower Recruitment or Supply Agency Services". The definition of this term is mentioned in clause (105)(k) r.w. Section 65(68) of the Finance Act, 1994, which read as under :- "(105)(k) "Taxable service" means any service provided or to be provided to any person, by a manpower recruitment or supply agency in relation to the recruitment or supply of manpower, temporarily or otherwise, in any manner" "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 other person." 6. In view of provisions of Section 65(68) the "Manpower Recruitment or Supply Agency Services" means any person providing any service, directly or indirectly, in any manner for recruitment or supply of manpower, temporarily or ot....
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....wer 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 other person" and the taxable service is defined under Section 65(105)(k) as "service rendered to any person by a manpower recruitment or supply agency in relation to the recruitment or supply of manpower, temporarily or otherwise, in any manner". The appellants are not manpower recruitment agencies as they do not recruit any persons; they also do not supply manpower to the sugar factory. What they have undertaken is harvesting of sugarcane and transportation of the same to the sugar factory. To undertake that work, they have entered into an agreement with the contractors who have provided the manpower for harvesting of the sugarcane and transportation of the same. In any service activity, manpower is required. That does not make the service as supply of manpower. Otherwise, all services would have to be classified as "manpower supply service". Further in the instant case, the consideration is paid not on the supply of manpower but on the sugarcane supplied on tonnage basis. If an efficient c....
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....he impugned demands have been raised under the category of manpower supply or recruitment agency services, such demands cannot be sustained at all. 6. In view of the above and also in view of the decisions of this Tribunal in the case of Amrit Sanjivni Sugarcane Transport Co. Pvt. Ltd. and Samarth Sevabhavi Trust (cited supra), we hold that the impugned demands are not sustainable in law. Accordingly we set aside the demands and allow these appeals. Since the appeals are allowed on merits, we are not going into the other issues raised by the appellants. We are informed that in some cases, the appellants have made payments. If the appellants have made any payments towards these demands, refund of the same shall be considered by the department in accordance with the law." (d) CCE, Kolhapur vs. Shriram SAO TVS Limited. "3. The issue involved in this case is regarding the service tax liability of the respondent under the category of "Manpower Recruitment and Supply Agency Service". The lower authorities came to a conclusion that the respondent who is registered under co-operative society; service tax liability gets confirmed for undertaking the activities of ....
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....tory. Harvesting sugarcane, atleast today, is a labour intensive activity. Very soon, this work would be done mechanically. So, the nature of work undertaken by the respondent must be understood in the context in which it was understood by the respondent and its principal-sugar factory. This interpretation of the agreement between the respondent and its principal is in tune with the judgment of the Supreme Court in the case of Super Poly Fabriks Ltd. v. Commissioner of C. Ex., Punjab, reported in 2008 (10) S.T.R. 545 (S.C.). Paragraph No. 8 of the said judgment can be relied upon to drag the point home, which reads as under :- "8. There cannot be any doubt whatsoever that a document has to be read as a whole. The purport and object with which the parties thereto entered into a contract ought to be ascertained only from the terms and conditions thereof. Neither the nomenclature of the document nor any particular activity undertaken by the parties to the contract would be decisive." 7. In any case, the agreement itself is eloquent enough to draw the above conclusion. In this background, we must look at the show cause notice dated 16-10-2008. On that date, whether th....