TMI Blog2017 (12) TMI 157X X X X Extracts X X X X X X X X Extracts X X X X ..... or home consumption or for export - credit allowed. Refund claim - man power recruitment service - security service - refund claims were rejected by the original adjudicating authority relying on Rule 5B of the Cenvat Credit Rules, 2004 read with N/N. 12/2004-CE (NT) dated 03/03/2014 - whether the appellants are providers of service or not in terms of Rule 5B of the Cenvat Credit Rules? - Held that: - It is clear from the notification and Rule 5B that the said rule and notification are intended solely for the service provider providing specific services - The appellant's claim is that by virtue of Section 68 (2), since liability to pay partial service tax has been imposed on them they become service provider is misplaced - The Act differ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d value, to any person who is not engaged in a similar business; (ii) Supply of manpower for any purpose or security services; or (iii) Service portion in the execution of a works contract. 1.1 The original adjudicating authority held that the appellants are registered under service tax for payment of service tax on the following services: (a) Security/detective agency service (b) Manpower recruitment/supply agency service (c) Works Contract Service (d) Other taxable services other than the 119 listed and as GTA and under Business Auxiliary Service. 1.2 The order-in-original holds that Sl.No. (a) to (d) of the above services, the appellant is registered as service recipient and discharging liability und ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e decision of Hon'ble High Court of Bombay in the case of Sharp Menthol India Ltd., 2011 (270) ELT 212) which has been approved by the Hon'ble Apex Court vide order dated 04/04/2012 Copy of the said order was produced by the Ld. Counsel in the Court. 2.1 He argued that in these circumstances, service tax paid cannot be denied in respect of non-excisable goods, which are exported. Ld. Counsel argued that Government exercising the power conferred under sub-section (2) of Section 68 of the Finance Act, made the appellants liable to pay service tax. He argued that the Government made a fiction. It has specifically been mentioned in sub Section (2) of Section 68 that the provision of whole Chapter V of the Finance Act, 1994 would ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dly the exempted menthol crystals have not been cleared for home consumption but have been cleared for export under bond and, therefore, Rule 6(1) to 6(4) of 2004 Rules would not apply, but Rule 6(6)(v) would apply. In other words, non allowability of input credit under Rule 6(1) to 6(4) of 2004 Rules is applicable only when the inputs used in the manufacture of exempted final products are cleared for home consumption without payment of duty and not when exempted final products are cleared for export without payment of duty under bond. In the present case, exempted menthol crystals has been exported without payment of duty under bond and, therefore, the assessee was entitled to take the credit of duty paid on menthol used in the manufacture ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s have claimed that they are paying service tax on following four services on reverse charge basis. (a) Security/detective agency service (b) Manpower recruitment/supply agency service (c) Works Contract Service (d) Other taxable services other than the 119 listed and as GTA and under Business Auxiliary Service. And therefore, they are service providers in terms of Finance Act, 1994. They have particularly relied on sub-section (2) of Section 68 of the Finance Act,1994, which makes them liable to pay service (partly) in respect of services received by them, as if all the provisions of Chapter V are applicable to them. The Commissioner (Appeals) has discarded this argument by observing that of Rule 5B of the Cenvat Cre ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... specific services. The appellant's claim is that by virtue of Section 68 (2), since liability to pay partial service tax has been imposed on them, they become 'service provider' is misplaced. The Act differentiates between the 'service provider' and 'person liable to pay service tax' under different circumstances. It is possible that the person liable to pay service tax may not be the service provider. If the Government intended to provide this facility to service recipient paying service tax on reverse charge basis the Government would have used the word person liable to pay service tax and not the word service provider . Section 68 (2) is a special mechanism for shifting part liability to pay service tax fr ..... X X X X Extracts X X X X X X X X Extracts X X X X
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