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2016 (1) TMI 1014 - CESTAT MUMBAI

2016 (1) TMI 1014 - CESTAT MUMBAI - 2016 (42) S.T.R. 568 (Tri. - Mumbai) - Job work - Business Auxiliary services - Default in discharging their service tax liability even though they continued to bill their principals for service tax. - financial difficulties - The appellant claims that their activity is manufacture and hence not liable to be taxed as "business auxiliary service", that they were eligible for exemption under notification no. 8/2005-ST dated 01/03/2005. - Held that:- appellan .....

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ntively, to seek a revisit of classification of the service rendered by the appellant, there is no legal provision to do so. The plea of taxability and any exemption from service tax is irrelevant in the context of the inclusion of service tax in the amounts billed to their principals as job-work charges. - It is seen that the appellant has collected service tax along with consideration from its principals for service rendered but failed to deposit the same in the government account. By this .....

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hines for M/s Magnum Forge Pvt Ltd, M/s Magna Casting Pvt Ltd and M/s Worldwide Oilfield Machine Pvt Ltd and had been paying service tax on such "job work" charges till June 2007, but stopped discharging their liability even though they continued to bill their principals for service tax. Thereafter, they deposited ₹ 3,03,698/-, relating to dues for the period upto September 2007, on 18th June 2008 with no further payment till issue of notice on 2. M/s Mohtamaan Industries was ser .....

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al Excise (Appeals), Pune I, by order-in-appeal no V2PI/139/STC/2010 dated 14th October 2010 concurred with the original authority. Aggrieved by this order, M/s Mohtamaan Industries is before the Tribunal challenging the classification and seeking the setting aside of penalties. 3. The appellant claims that their activity is manufacture and hence not liable to be taxed as "business auxiliary service", that they were eligible for exemption under notification no. 8/2005-ST dated 01/03/20 .....

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h certificate of Shri RK Bhagwat, partner in appellant firm, issued by Pimpri-Chinchwad Municipal Corporation and reiterated the financial crisis that prevented the appellant from depositing of tax. Learned Authorized Representative drew attention to the decision of this Tribunal in Ketan Engg. Services (P.) Ltd. v. CCE & ST [Final Order No. A/11103/2014-WZB/AHD, dated 16-6-2014]. 5. Admittedly, the appellant does machining of forged components of CNC machines and had been paying tax for a t .....

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e bereft of any ground to claim error in classification. In the event of a doubt regarding the taxability, the proper course open to appellant would have been to file a refund claim instead of using the second stage of appeal as a platform to seek a decision on non-leviability. This Tribunal in Malabar Management Services (P.) Ltd. v. CST [2008] 14 STT 107 (Chennai) has foreclosed the option of challenging the classification by this route thus: We have also noted that the appellants got themselv .....

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the appellant, there is no legal provision to do so. The plea of taxability and any exemption from service tax is irrelevant in the context of the inclusion of service tax in the amounts billed to their principals as job-work charges. 6. It is seen that the appellant has collected service tax along with consideration from its principals for service rendered but failed to deposit the same in the government account. By this act of omission, the plea of leniency in the matter of penalties will not .....

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