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2013 (9) TMI 358 - AT - Service TaxLiability to Service Tax - Manufacturing Activity OR Services Rendered - Whether the impugned activity can be split into two - one as manufacturing by JLSL and the other as service by appellant (earlier known as PMSL) to JLSL - Whether there can be two manufacturers for the same goods - Held that:- The activities under taken by the assesse during the period April 07 to Sept. 09 being a manufacturing activity carried out cannot be classified as business support service and subjected to service tax and hence the demand failed - The demand failed on account of time-bar also because all relevant facts had been disclosed to the department in time - The same activity cannot be considered as manufacturing and subjected to excise levy and at the same time considered to be a service and subjected to service tax - Revenues contention was that what JLSL was doing was manufacturing and what assesse (earlier known as PMSL) was doing was support services. In the instant case JLSL claimed to be the manufacturer and the claim was accepted by Central Excise Department and JLSL was paying excise duty - There was no scope for PMSL to claim that their activity should also be considered as manufacturing activity in respect of the same goods - In a situation where the other party (JLSL in this case) was willing to pay excise duty at the time of clearance of the goods from the factory of manufacture there was no need to adopt the procedure laid down in Notification 214/86 - The predominant activities for manufacture were done by assesse (earlier known as PMSL). All the activities done by the assesses had to be seen together and when it was so seen it was clear that they were doing manufacturing activity - The fact that they were charging separately for fixed costs and variable costs was not disclosed to the department - this aspect could not actually change the nature of the activity - Decided in favor of Assesse.
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