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2016 (6) TMI 1072 - CESTAT NEW DELHI

2016 (6) TMI 1072 - CESTAT NEW DELHI - 2016 (45) S.T.R. 191 (Tri. - Del.) - Job work - activity of processing of chilling of milk - deemed manufacturing or not - Business auxiliary service - revenue argued that Chapter Note 6 to Chapter 4 ibid is to be interpreted keeping in view the principles of noscitur sociis by virtue of which the expression Ďany other treatmentí appearing in the said chapter note has to be only such treatments which are similar to labelling or relabeling of containers or r .....

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us to warrant any explaining/discussion. Consequently by virtue of the said chapter note, chilling of milk amounts to manufacture and it is settled law that process amounting to manufacture is not liable to service tax. - Demand of service tax set aside - Decided in favor of assessee. - ST/60635/2013-CU(DB) - Final Order No. 52122/2016 - Dated:- 9-6-2016 - Mr. S.K. Mohanty, Member (Judicial) and Mr. R.K. Singh, Member (Technical) Ms. Rinky Arora, Advocate- for the appellant Shri Amresh Jain, D.R .....

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hat as per Chapter Note 6 of Chapter 4 of Central Excise Tariff the process of chilling of milk amounts to manufacture and therefore the said activity is outside the purview of service tax as it would not be within the purview of service. She also cited the judgement in the case of Sharma Ice Factory Vs. CCE, Jaipur-I - 2015(37) STR 660 (Tri.-Del.) wherein it was held that chilling of milk is not covered under business auxiliary service and a similar demand was set aside. The said judgement in t .....

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containers or repacking from bulk packs to retails packs and seen in this context chilling would not be the treatment covered within the scope of the expression any other treatment mentioned in the said Chapter Note 6. Consequently chilling of milk will get covered under business auxiliary service. He also added that CESTAT judgement in the case of Sharma Ice Factory (supra) does not lay down any ratio and therefore is of no precedential value. 4. We have considered the contentions of both side .....

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s. There is no dispute about the nature of the appellant s activity - chilling of milk to temperature below 50Celcius for M/s. SZDUSS Ltd. No other activity like pasteurization etc. is involved. We are of the view that mere chilling of milk to temperature below 50Celcius for the purpose of its long distance transportation, does not amount to production or processing of goods, as there is no permanent or temporary change in milk other than lowering of the temperature by the process of chilling of .....

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new product with distinct characteristics, commercial identity and usages has emerged. The process of chilling of milk to make it fit for long distance transportation without getting spoiled, which does not bring into existence any change whatsoever, would not amount to production or processing of the goods not amounting to the manufacture. We also find that earlier, the Commissioner (Appeals) on this very issue had taken view that chilling of milk is not Business Auxiliary Service covered by S .....

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mount to service classifiable under the business auxiliary service given the definition of the business auxiliary service under Section 65(19) of Finance Act, 1994. At this stage, we would like to reproduce Chapter Note 6 to Chapter 4: 6. In relation to products of this Chapter labelling or relabeling of containers or repacking from bulk packs to retail packs or the adoption of any other treatment to render the product marketable to the consumer, shall amount to manufacture . There is no doubt t .....

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ve analysis, we agree with the decision/conclusion in CESTAT judgement in case of Sharma Ice Factory (supra) but, as is evident, we do so on the basis of our reasoning which is not similar to the reasoning contained therein. 6. Coming to the contention of ld. DR that noscitur sociis principle should be applied for interpreting the scope of any other treatment and according to the said principle, only such other treatments which are similar to labelling or relabeling of containers or repacking fr .....

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