TMI Blog2013 (11) TMI 1305X X X X Extracts X X X X X X X X Extracts X X X X ..... o. 26928-26930/2013 - Dated:- 7-11-2013 - SHRI B.S.V.MURTHY AND SHRI ANIL CHOUDHARY, JJ. For the Appellant: J. Tanuja D. Arun Teja, Advocates For the Respondent: Mr. S. Teli, Dy. Commissioner (AR) JUDGEMENT Per: ANIL CHOUDHARY These three appeals having common question of facts and law involved have been filed by three different appellants. The details are as follows: Appellants name Impugned order No./Date Order-in-original No./date Amount of tax Amount of penalty Shri Sajjid Ahamad No.78/2012 (T) ST dt. 5.11.2012 No.12/2012 ST dt.6.2.2012 Rs.11,51,597/- Rs.5000/- or Rs.200/ per day u/s 77(1) Rs.5000/- u/s 77(2) Rs.2000/- us/s 70 Rs.11,51,597/- u/s 78 A Janardhan Goud No.79/2012 (T) ST dt. 5.11.2012 No.15/2012 ST dt.6.2.2012 Rs.12,17,264/- Rs.5000/- or Rs.200/ per day u/s 77(1) Rs.5000/- u/s 77(2) Rs.2000/- us/s 70 Rs.12,17,264/- u/s 78 P Mallikarjun Reddy No.80/2012 (T) ST dt. 5.11.2012 No.13/2012 ST dt.6.2.2012 Rs.11,51,597/- Rs.5000/ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g) To maintain the quality of MS and HSD supplied by the Corporation. h) To check the dispensing pumps to ensure delivery of correct quantity of MS and HSD on daily basis before start of sales and in addition, if a complaint is received at any time of the day. In case of variation in delivery of product, the sales from such pumps should be stopped immediately and inform the officer-in-charge in writing. Record of quantity used for testing dispensing pumps should be maintained. Totalizer seals and W M seals should be inspected every day and in case damage is observed, ales should be stopped immediately from such dispensing pumps and status to be conveyed to the officer-in-charge in writing. i) Quality control equipment i.e., Hydrometer, Thermometer and Measuring Jar as well as quantity measuring equipment like weights and measures duly calibrated and stamped 5 litre measure and other measures for selling loose oils should always be maintained in good condition. 2.1.2. The labour contractor will dispense for sale products of the Corporation only and no other products will be allowed to be received/delivered/sold through the retail outlet except with the prior written permiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be made good by the labour contractor. 2.1.7. The labour contractor will safeguard the corporation s property and any damage will have to be reimbursed to the corporation. 3. For purposes of carrying out the above activities at the Retail Outlet, the Labour contractor shall provide 1 office staff, 1 security guard, 1 air boy, 5 driveway salesmen and 1 relief staff. The requirements of Driveway Salesmen shall be reviewed on a quarterly basis by the Corporation and communicated to the labour contractor for compliance. 4. The labour contractor shall scrupulously observe and comply with all laws, rules, regulations and requisitions of the Central / State Government and of all authorities appointed by them or either of them including in particular, the Chief Controller of Explosives, Govt. of India and/or Municipal and/or any other local authority with regard to the storage and sale of petroleum products. 5. The expenses in connection with the operation of the Retail Outlet like electricity, water, etc. will be borne by the Corporation. With regard to telephone, only rentals and local calls and trunk calls to corporation s offices and supply points will be borne by the corporat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . B. In addition, the Corporation will also pay to the contractor a remuneration at the rate of Rs.57.08 per KL MS+HSD for the actual sales volume per month. C. The amount payable to the Labour Contractor will be worked out on a monthly basis and paid on the 15th day of each calendar month for the jobs performed in the preceding month. Stock losses beyond ceiling limits as mentioned in Clause 16 will be deducted from the bills based on the prevailing Retail Selling Price of the outlet location. Unquote 3. Show cause notices were issued invoking extended period, against the appellants on obtaining information regarding the details from HPCL wherein the various clauses of Agreement as quoted above were taken note of. It was further noticed that the appellants for the period has received remuneration as follows: Appellants Period Amount received from HPCL Shri Sajjid Ahamad September 2006 to March 2011 Rs.1,00,02,274/- A Janardhan Goud April 2006 to March 2010 Rs.1,03,74,547/- P Mallikarjun Reddy September 2006 to March 2011 Rs.1,00,62,307/- It was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (a) The adjudicating authority did not substantiate under which of the various categories of taxable activities enumerated under Business Auxiliary Service, the impugned activity is classified. The show cause notice was issued on a vague proposal and the demand confirming on weird and vague proposal. (b) The impugned order does not speak either on the grounds of classification or on valuation. (c) The adjudicating authority failed to look into the agreement in detail and find that the consideration paid to us is for many activities which cannot be vivisected. (d) The service receiver is a manufacturer and they are eligible to take cenvat credit of service tax paid by us. Therefore neither we, nor the service receivers bear the burden of service tax which is ultimately passed on to successive service receiver or buyer of excisable goods. In such circumstances, it was not sure why the service receiver did not pay service tax to us. We are not aware of the service tax liability and its intricacies. The classification of service rendered by us and the service tax liability on the same is not free from doubt even on this day. Valuation of taxable services is also not free from a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . 28 (Tri.-Del.) * Somnath Rakesh Kumar vs. CCE, Chandigarh: 2008 (11) S.T.R. 392 (Tri.-Del.) * Harinder Goyal vs. CCE, Chandigarh: 2008 (11) S.T.R. 129 (Tri.-Del.) * Dhanula Co. Contracotr vs. CCE, Ludhiana: 2009 (14) S.T.R. 430 (Tri.-Del.) And accordingly the Commissioner (A) was pleased to uphold the orders-in-original along with interest and penalties. 6. Being aggrieved the appellants are before this Tribunal and for the purpose of stay submits that the appellants are prima facie labour contractors, credit have not been allowed for reimbursement of expenses towards labour, electricity, water charges, etc. paid by the appellants on behalf of HPCL (on pure agent basis), which is about 75% of gross, and also strongly urges the Revenue neutrality as HPCL would have been entitled to take credit as a manufacturer of the service tax paid by these appellants. Further, if reimbursed expenses are reduced from gross value as held in Intern-continental Consultants and Technocrats (P) Ltd. vs. UOI: 2013 (29) S.T.R. 9 (Del.), the demands will be reduced by about 60% to 70%, and accordingly prays for remand. It is further prayed that the appellants are people of small means, an ..... X X X X Extracts X X X X X X X X Extracts X X X X
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