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2015 (3) TMI 1170 - BOMBAY HIGH COURT

2015 (3) TMI 1170 - BOMBAY HIGH COURT - 2016 (41) S.T.R. 806 (Bom.) , [2016] 90 VST 231 (Bom) - Demand of Service tax alongwith interest - Section 73 of the Finance Act, 1994 - Manpower Recruitment or Supply Agency Services - Act of harvesting of sugarcane and transporting the same from the fields of the concerned farmers to the sugar factories' site - Held that:- there is no supply of labour to the sugar factory concerned. The respondents have undertaken the activities of harvesting of sugarcan .....

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ts to the sugar factory to constitute supply of manpower. - Decided against the revenue - Central Excise Appeal No. 16 OF 2014, 17 OF 2014, 22 OF 2014 With 23 OF 2014 - Dated:- 20-3-2015 - A.V. NIRGUDE AND V. K. JADHAV, JJ. For the Petitioner : Dr. Mrs. Kalpalata Patil - Bharaswadkar For the Respondent: Mr. R. A. Tambe ORDER (PER JADHAV, J.) :- 1. Being aggrieved by the final order passed by Central Excise and Sales Tax Appellate Tribunal, Mumbai, Revenue has preferred the present appeals. A com .....

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emunerations for harvesting and transportation were paid on tonnage basis. The appellant was of the view that the act of harvesting of sugarcane and transporting the same from the fields of the concerned farmers to the sugar factories' site is classified as Manpower Recruitment or Supply Agency Services and is chargeable to service tax. Accordingly, show cause notices came to be issued to the respondents demanding service tax under the provisions of Section 73 of the Finance Act, 1994 alongw .....

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by its separate impugned judgments in all cases, set aside the order and allowed the appeals. Being aggrieved by the same, the Revenue has filed these appeals. 3. The learned counsel for the appellant submits that as per the definition and scope of Section 65 (105) (K) of the Finance Act, 1994, and also the term Manpower Recruitment or Supply Agency Services as separately defined in clause 68 of Section 65, the activities performed by the respondents cannot be done or completed without the aid .....

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far away from the facts involved in the case. The appellate Tribunal has failed to classify the activities properly under Manpower Recruitment or Supply Agency Services , which resulted into miscarriage of justice. 4. The learned counsel for respective respondents submit that individual farmers entered into an agreement with sugar factory concerned for purchase of their sugarcane before commencement of season of sugarcane cultivation and the concerned sugar factory paid advance to them to meet .....

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urther transporting the same to the sugar factory. For that purpose, the respondents availed the services of various contractors, who supplied the labour for harvesting and transporting of sugarcane. The respondent company is co-ordinating between sugar factory and labour contractors for which they received consideration from sugar factory towards supervision charges and they discharge the services and tax liability thereon under the head Business Auxiliary Services . Learned counsel for respect .....

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is whether the services would fall within the definition of Manpower Recruitment or Supply Agency Services . The definition of this term is mentioned in clause 105 (K) r.w. Section 65 (68) of the Finance Act, 1994, which read as under:- 105(k) Taxable service means any service provided or to be provided to any person, by a manpower recruitment or supply agency in relation to the recruitment or supply of manpower, temporarily or otherwise, in any manner 65(68) manpower recruitment or supply agenc .....

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ng such services. From the above definitions, it is rather clear that it envisages supply of labour which can be classified as Manpower Recruitment or Supply Agency Services . In the case in hand, there is no supply of labour to the sugar factory concerned. The respondents have undertaken the activities of harvesting of sugarcane and transporting the same to the sugar factory for which labour is employed. 7. Having regard to the nature of contract between the respondents and sugar factory and th .....

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