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2023 (7) TMI 635 - AT - Service TaxLevy of Service tax - manpower recruitment or supply agency service - separate employment contract with foreign expatriates - payments directly to the expats like salary and other allowances, which are not reimbursement of any expenditure - suppression of facts or not - time limitation - revenue neutrality - HELD THAT:- In terms of the agreement between the parties, specifically Article 4, where ‘salary, bonus and others’ have been provided for, it is clear that it is for the appellant to pay the salary, bonus, perks, etc., to the secondees working for it in India, and there is also no dispute that the above clauses of the agreement are binding on both the parties - It is thus clear that what is paid is towards the cost incurred for making available the service which the appellant has received. Further, in terms of the definition under Section 67 ibid., ‘consideration’ would include any amount that is payable for the taxable services provided or to be provided and thus, there is no doubt in our mind that what is provided by M/s. NMC is nothing but manpower recruitment service. The decisions of the Hon’ble Apex Court in C.C.,C.E. & S.T. – BANGALORE (ADJUDICATION) ETC. VERSUS M/S NORTHERN OPERATING SYSTEMS PVT LTD. [2022 (5) TMI 967 - SUPREME COURT], clearly hold that the definition of manpower recruitment or supply agency is wide enough to include ‘recruitment’ as well as ‘supply’ of manpower. The expression ‘supply’ is of a wider connotation than recruitment - thus the ratio of the above rulings squarely apply to this case and thus, there is no escape for the appellant before us from Service Tax liability in respect of manpower recruitment or supply agency service under reverse charge mechanism - the appellant is required to pay applicable Service Tax for the normal period along with interest. Time limitation - suppression of facts or not - HELD THAT:- On perusal of the table indicating the dates of SCN/SODs and periods covered vis-à-vis the other table wherein the visit by the officers of the Revenue on various dates is depicted. From the above, even if it were to be assumed that the appellant had received manpower supply services, the fact remains that the whole of the activities were within the knowledge of the Revenue / officials of the Department and hence, there is no scope whatsoever to allege suppression of any facts - the issue, therefore, involved classification and interpretation of taxing statute, for which reason also suppression of facts could not be alleged. Revenue Neutrality - HELD THAT:- There are no doubt that it is the case of a revenue neutral situation and that by suppressing the same, the appellant / assessee could not have achieved any benefit - In the case of M/s. Northern Operating Systems Pvt. Ltd. the Hon’ble Court held that This Court has been, in the present case, called upon to adjudicate about the nature of the transaction, and whether the incidence of service tax arises by virtue of provision of secondment services. Thus, on merits, the appellant has to fail, but however, the appellant’s claim as to this case being revenue neutral, deserves merit, for which reason the extended period of limitation cannot be invoked. Further, even on the issue of limitation, following the decision in the case of M/s. Northern Operating Systems Pvt. Ltd. specifically paragraphs 64 and 66 which are extracted by us elsewhere in this order, we hold that the demand, if any, would survive only for the normal period.
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