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2018 (8) TMI 32 - AT - Service TaxBusiness Auxiliary Service - “production” of goods not amounting to “manufacture” and covered under Business Auxiliary Services - appellant are engaged in processing of machining, drilling, shot blasting and painting on job work basis for the principle on the semi finished casting supplied by M/s Patel Alloys - Case of the department is that since the appellant is engaged in production activity, the same is liable for service tax under the sub head of production of goods on behalf of the client under Clause (V) of Business Auxiliary Service. Held that:- The appellant have carried out the processing of machining, drilling, shot blasting and painting, thereafter, the resultant product is final part of wind turbine which is a final product, hence the process under taken by the appellant, clearly falls under the category of production. The Division Bench of this Tribunal in the case of PSL Corrosion Control Services Ltd [2008 (8) TMI 72 - CESTAT AHMEDABAD] held that even mere epoxy coating made on steel bars supplied by the client is amount to production and accordingly liable for service tax under Business Auxiliary Services. In the present case much more processing of machining, shot blasting, drilling were carried out in addition to painting, therefore, the activity carried out by appellant are indeed falls under production - The service of production of goods on behalf of the client was very much taxable during the impugned period, therefore, it is legally liable to service tax. Appeal dismissed - decided against appellant.
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