9911796707
TMI Blog2014 (11) TMI 335X X X X Extracts X X X X X X X X Extracts X X X X ..... t, 1994 have been imposed. Show-cause notice was issued on 14.10.2011. 2. The appellants have engaged in the manufacture and marketing of Biscuits. The appellants have outsourced the manufacturing activity of biscuits to various job-workers and the issue before us is in relation to such outsource arrangement entered into by the appellants with J.B. Mangaram Foods Pvt. Ltd. (JBM) vide agreement dated 9.5.2000 for manufacture of biscuits for the appellants. To ensure that quality of biscuits is as per the specification and standards of the appellants the appellants deputed certain personnel to JBM premises to carry out checks on the quality of biscuits manufactured by JBM on their behalf. Salaries of the said personnel were recovered from jo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is misplaced. The circular suggests that personnel should come under the direction and control of the service recipient which is not the situation in the instant case. (v) 'Manpower supply agency service' does not envisage a situation where there is a contract for completing a job ad hoc. As per circular No. 96/7/2007-ST dated 23.08.2007, the impugned service covers such cases where the agreement is for the utilization of the services of an individual, and such individuals are supplied by the agency/person. (vi) The appellants are not 'manpower recruitment or supply agency'. In this context, the relevance of the phrase 'engaged in' has to be understood in the light of the following cases : ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sts e.g. salary and other contributions. (x) There is no suppression of facts by the appellants nor an intent to evade payment of taxes. Extended period cannot be invoked and the entire demand is barred by limitation. The department has itself taken a conflicting view on the same transaction and classified it as 'Management or Business Consultancy Service'. (xi) Mere non-payment of service tax does not amount to suppression. No penalty is imposable and no interest is payable since the issue involves interpretation of complex legal position. Further, penalty under both sections 76 & 78 of the Act cannot be invoked simultaneously. (xii) The appellants have assessed its liability as it deemed correct and filed its returns regularly in the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the service provided by them are for the benefit of the appellant and not for the benefit of JBM at all. The appellants are actually forcing upon JBM their personnel to supervise their operations and it is not that JBM are requesting for assistance of these personnel. In the case of manpower supply, the receiver makes a request for service and therefore, the service is provided. Prima facie, we do not find relationship of 'manpower supply service' provider and service receiver between the appellants and JBM. Moreover, we also find the entire demand is time-barred. Therefore, we are not convinced about the correctness of stand taken by the Revenue either on merits or on limitation at this stage. In these circumstances, requirement of pre-d ..... X X X X Extracts X X X X X X X X Extracts X X X X
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