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Artefact Infrastructure Ltd. Versus Commissioner of Central Excise, Nagpur

2016 (1) TMI 208 - CESTAT 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 manpower is carried out by the appellant. Therefore, the services of the ap .....

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onsultant 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) ORDER Per : Ramesh Nair The appeal is directed against Order-in-Appeal No. .....

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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 Consultant Service and accordingly confirmed the demand of Service Tax amount .....

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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 of 16-6-2005, therefore the services are not taxable during the relevant p .....

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ant 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 exceeding twice the amount of the Service Tax. The Adjudicating Authority an .....

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ongwith 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 of Understanding , which is reproduced below: Memorandum of Understanding .....

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e 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, successors and assigns of the Second Part. Whereas Party No. 1 and Party No. .....

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nt 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. 2. 2. Party No. 2 shall issue a requirement sheet to the Party No. 1 givi .....

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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 Service . From the payment terms also it appears that the charges are for .....

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f 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 Charges of Manpower . This fact also shows that the appellant is providi .....

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