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2016 (1) TMI 208 - CESTAT MUMBAI

2016 (1) TMI 208 - CESTAT MUMBAI - 2016 (42) S.T.R. 34 (Tri. - Mumbai) - Management Consultant Service - appellant submits that their activities are confined to supply the manpower and supervision thereof, hence the same is not covered under the definition of “Management Consultant Service” - It was contended that there services are not taxable during the relevant period i.e. 2002-03 and 2003-04 - Held that:- In the present case, first manpower is recruited, thereafter supervision of the said ma .....

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ice provided by the appellant falls under the definition of “Management Consultant Service”, therefore it is indeed taxable.

Demand of service tax confirmed with interest - penalty reduced - Decided partly in favor of assessee. - Appeal No. ST/52/10-Mum - Final Order No. A/3727/2015-WZB/STB - Dated:- 24-11-2015 - Mr. P.S. Pruthi, Member (Technical) And Mr. Ramesh Nair, Member (Judicial) For the Petitioner : Shri R.G. Seth, Advocate For the Respondent : Shri V.K. Kaushik, A.C, (AR) O .....

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services. A show cause notice was issued wherein it was alleged that the services of consultancy and supervision falls under the head of Management Consultant Service accordingly the demand of Service Tax of ₹ 89,538/- for the period 2002-03 and 2003-04 was proposed and penalty & interest were also proposed. In the adjudication the adjudicating authority vide order No. 137/2009/STC dated 28/01/2009 held that the service of management and supervision is classified under Management Cons .....

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said Original Order by passing an impugned order. Aggrieved by the said impugned order the appellant is before us. 3. Shri R. G. Seth, Ld. Counsel for the appellant submits that their activities are confined to supply the manpower and supervision thereof, hence the same is not covered under the definition of Management Consultant Service . He submits that at the most, the services are covered under supply of manpower which was included under the head of Manpower Recruitment Agency with effect o .....

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entire transactions were recorded in their books of accounts. The appellant was of bonafide belief that their services do not fall under Management Consultant Service , but it may fall under supply of manpower which is not taxable. For this reason, there is no suppression of the fact on part of the appellant. The demand is time bar. As regard penalty, it is his submission that the penalty, at the relevant time prescribed under Section 78, was ranging from equal amount of Service Tax but not exc .....

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llant before awaiting the adjudication, paid the amount of Service Tax alongwith interest. For this reason also penalty cannot be imposed. 4. On the other hand Shri V.K. Kaushik, Ld. Asstt. Commissioner (AR) appearing on behalf of the Respondent reiterates the findings of the impugned order. 5. We have carefully considered the submissions made by both the sides. 6. For the services provided by the appellant to their client which is the group company of appellant, they entered into a Memorandum o .....

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meaning thereof include its administrators, successors and assigns of the First Part. AND M/s. Artefact Software and Finance Limited, Registered under the Indian Companies Act, 1956, having its Registered office at 1st Floor, Bhiwapurkar Chambers, Opp. Yeshwant Stadium, Dhantoli, Nagpur-440012 represented by through its Director/Authorized Signatory (hereinafter referred to as Party No. 2) which expression shall unless repugnant to the context or meaning thereof include its administrators, succ .....

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ces. Whereas Party No. 2 has approached the Party No. 1 for its requirement of qualified and skilled professional for its staff augmentations purposes from time to time and Party No. 1 agreed to provide technical manpower for fulfilling its manpower requirement under the following terms and conditions. 1. Party No. 1 shall provide and supervise expert manpower required of professional personnel s at various sites for further rendering of services for various Infrastructure projects of Party No. .....

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d shall charge 2% to 3% supervision charges as per project requirements. 5. Party No. 2 undertakes the utilization of facilities of Manpower and shall submit bills to the Party No. 2 for payment, before the end of every quarter. From the above MOU, it is seen that the appellant is engaged primarily recruitment of the manpower and supervision thereof to the service recipient. The combined services on recruitment and supervision of the staff are, in our view falls under the Management Consultant S .....

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upply manpower temporarily and they charge to their client on the basis of salary and wages of manpower. In the present case, first manpower is recruited, thereafter supervision of the said manpower is carried out by the appellant. Therefore, the services of the appellant that is requirement of staff and continuous supervision, thereof, in our view falls under Management Consultant Service . Further from the bills issued by the appellant to their client the description of services is Supervision .....

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