TMI BlogDraft - Levy of service tax on distillers under “Business Auxiliary Service” for manufacture of Indian Made Foreign Liquor on job work basis – reg.X X X X Extracts X X X X X X X X Extracts X X X X ..... ponse/Comments only) F.No. 249/1/2006-CX.4 Government of India Ministry of Finance Department of Revenue (Central Board of Excise and Customs) Subject : Levy of service tax on distillers under "Business Auxiliary Service" for manufacture of Indian Made Foreign Liquor on job work basis - reg. A number of distillers are engaged in manufacture of Indian Made Foreign Liq ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... thin the meaning of clause (f) of section 2 of the Central Excise Act, 1944 . 3. The manufacture of alcoholic beverages falls outside the 'Union List' of the Seventh Schedule to the Constitution of India, by virtue of Entry 51 (a) of List II of the Seventh Schedule. Therefore, the Central Excise Act cannot and does not apply to manufacture of alcoholic beverages. Accordingly, IMFL being potab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ist. 4.1. This matter was referred to the Law Ministry for their opinion. Law Ministry has opined that as the IMFL is not the subject matter of Union Excise, section 2(f) does not apply to it and that the definition of section 2(f) can be restored for the purposes of Service Tax (it is a borrowing Act). As regards the legislative competence of Parliament to impose service tax levy, Entry 51 of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er of Gujarat Ambuja Cements Ltd Vs UOI (2005)4 SCC 214, and T N Kalayana Mandapam Association Vs UOI (2204) 5SCC 632, wherein service tax levy has been upheld on the service tax aspects of activities which are otherwise subject matter of State List. 5. In view of above, Board is of the view that the activity of blending, manufacture, bottling or labelling, etc on job work basis by a distiller, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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