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2024 (4) TMI 394 - AT - Service TaxLevy of service tax - renting of immovable property service - manufacture/ processing of alcoholic beverages under job-work basis, for or on behalf of their clients, under manufacturing agreements - supply agency services - Extended period of limitation - HELD THAT:- A careful perusal of the agreements entered into by the appellant and particularly to the clauses extracted above would clearly establish that in terms of the manufacturing agreement the Appellant is responsible for the manufacture/producing IMFL under the brands belonging to CML in their own distillery, using their own manpower, skilled or un-skilled required for the manufacture of IMFL and also the cost of running the unit including the costs of overheads. Further it is also very clear from clause 13(a) of the manufacturing agreement, the consideration received by the Appellant is based on the goods manufactured and not for the manpower supplied. This clearly establishes that the services are for contract manufacturing of IMFL and not for manpower supply services as held in the impugned order. No adverse inference can be drawn for the reimbursement of expenses received by the appellant from the brand owner - there are no merit in the impugned order to demand Service tax on the manufacturing services provided by the Appellant under ‘Manpower Recruitment and Supply service’ and accordingly, the demand under the same is liable to be set aside, as held. Renting of immovable property during the period 2008-2009 - HELD THAT:- During the relevant period, the issue was disputed before various High Courts and finally ended up before the Supreme Court. Finally, the issue was put to rest by way of a retrospective amendment. This, itself, shows that there was lot of confusion on levy of tax on renting of immovable property service during the material period involved in this case. The normal period of limitation for the raising demand for non-payment of service tax as per Section 73 of the Finance Act during the impugned period is one year from the relevant date. The demand in this case is for the period from 01.04.2008 to 31.03.2009 and therefore the relevant date is the due date of filing of return i.e., 25.04.2009. Accordingly, the normal period of limitation will expire on 25.04.2010 and the show cause notice came to be issued on 21.10.2011. Thus, the entire demand of tax for the period 01.04.2008 to 31.03.2009 is barred by limitation - the demand of tax set aside. The impugned order and demand of tax on both ‘Manpower Recruitment and Supply Service’ and ‘Renting of Immovable Property Services’ set aside - all penalties are set aside - appeal allowed.
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