TMI Blog2016 (11) TMI 110X X X X Extracts X X X X X X X X Extracts X X X X ..... Technology software - service tax can only be demanded on the service received w.e.f. 16.05.2008 - Decided partly in favor assessee. - Appeal No. ST/335/12 - A/93195/16/STB - Dated:- 19-10-2016 - Shri M.V. Ravindran, Member (Judicial) And Shri Raju, Member (Technical) Shri Rohan Shah, Advocate with Shri Anay Banhatti and Suprema Kothari, Advocate for the appellant Shri A. B. Kulgod, AC (AR) for the respondent ORDER Per Raju The appellants were issued notice demanding service tax on the following services provided during the specified period. Notice was confirmed, except for demand of ₹ 92,837/-, by the Commissioner and penalty were imposed under Section 78 and 77 of Finance Act. Demands amounting to ₹ 81,809/- and ₹ 11,029/- were dropped. Aggrieved by the said orders, the appellants are before the Tribunal. Following are the services and period for which demands are raised. Sr. No. Category Period 1. Business Auxiliary Service 22.05.2006 to 18.12.2008 2. Manpower Recruitment or Supply ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... J on monthly basis. The said clause of the agreement reads as follows: SBL to maintain the required number of staff in their payroll to promote and market the J J range of products and such costs including the salary and related expenditure will be reimbursed by J J on a monthly basis. In the event of the agreement being terminated due to justifiable causes, J J to compensate the staff of SBL adequately. He argued that such arrangement cannot be considered as Manpower Recruitment or Supply Agency services for the reason that SBL is not Manpower Recruitment or Supply Agency. Ld. counsel argued that SBL is a distributor of their goods and is employing these staff on behalf of the appellant to promote the sale of J J range of products. 4. Ld. counsel argued that no staff has been supplied by SBL to the appellant. Furthermore, Ld. counsel argued that the actual cost and related expenditure is reimbursed to SBL and therefore it can be considered as reimbursement of expenditure and not provision of service. Ld. counsel relied on the decision of the Hon'ble High Court of Gujarat in Arvind Mills Ltd. 2014 (35) STR 496 (Guj). Para 5 of the decision reads as follows:- 5 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tware. Ld. counsel argued that for the period 16.06.2005 to 30.04.2006 the definition of maintenance and repair service reads as follows:- maintenance or repair means any service provided by (i) any person under a contract or an agreement; or (ii) a manufacturer or any person authorised by him, in relation to, (a) maintenance or repair including reconditioning or restoration, or servicing of any goods or equipment, excluding motor vehicle; or (b) maintenance or management of immovable property; After 01.05.2006 the definition became as follows:- (64) management, maintenance or repair means any service provided by (i) any person under a contract or an agreement; or (ii) a manufacturer or any person authorised by him, in relation to, (a) management of properties, whether immovable or not; (b) maintenance or repair of properties, whether immovable or not; or (c) maintenance or repair including reconditioning or restoration, or servicing of any goods, excluding a motor vehicle. With effect from 01.06.2007, Explanation was added to the said definition vide Finance Act, 2007, which reads as follows:- E ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oked. 10. In respect of sr.no. 1 and 7, it is seen that the liability for service tax arose before the investigation started. In these circumstances, it cannot be said that there was no suppression or misdeclaration. The fact that part of the period for which demand is made is same as the duration of investigation does not make any difference. In respect of sr. No. 1 7, the penalties imposed are upheld. 11. Appellants have been demanded duty under the head of Manpower Recruitment or Supply Agency services in respect of services allegedly from SBL. Ld. counsel argued that the agreement with SBL is not an agreement of service provision but it is an agreement involving only reimbursement. Ld. counsel has relied on the decision of the Hon'ble High Court of Delhi in Intercontinental Consultants Technocrafts (supra). Ld. counsel has also relied on the decision of Arvind Mills Ltd. (supra) wherein the Tribunal has held as follows:- 5. It is true that in the present form, the definition of Manpower Supply Recruitment Agency is wide and would cover within its sweep range of activities provided therein. However, in the present case, such definition would not cover the acti ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
