TMI Blog2018 (1) TMI 378X X X X Extracts X X X X X X X X Extracts X X X X ..... paid for not to target the consumers. Therefore, the activity undertaken by the appellant do not qualify under Business Auxiliary Service. Whether the extended period of extension is invokable or not? - Held that: - As there were divergent view on classification of services in question, therefore, extended period of limitation is not invokable in the facts and circumstances of the case - demand barred by limitation. Appeal allowed - decided in favor of appellant. - Appeal No.ST/52863-52865/2015-DB - Final Order No.60015-60017/2018 - Dated:- 1-1-2018 - Mr. Ashok Jindal, Member ( Judicial ) And Mr. Devender Singh, Member ( Technical ) Shri Sujit Ghosh Ms. Mannat Warraich, Advocate for the Appellant Shri G. M. Sharma, A.R. for the Respondent ORDER Per : Ashok Jindal The appellants are in appeal against the impugned orders wherein demand of service tax along with interest and penalties have been imposed on all the appellants. 2. The brief facts of the case are that one M/s. Amrit Banaspati Company Limited (ABCL for short) was having the appellants as their promoters and manufacturing various types of edible oils and other products under the bran ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h interest and various penalties have also been imposed on the appellants. Aggrieved from the said order, the appellants are before us. 3. The ld. Counsel appearing on behalf of the appellants submits that for non-competing agreement the appellants were not liable to pay service tax prior to 01.07.2012. He further submits that the ingredients for constituting Business Auxiliary Service are not met in the present case as non-compete does not amount to marketing or sale promotion. It is his submission that there must be direct nexus between the activity and the subject of tax which test does not stand satisfied in case of non-compete arrangements vis-a-vis Business Auxiliary Service and the allegations are on the basis of assumptions and presumptions. He further submits that extended period of limitation is not invokable therefore, it is prayed that impugned order is to be set-aside. 4. On the other hand ld. AR supported the impugned order and submits that as per the non-compete agreement, the appellants have indirectly promoted the business of M/s. Bunge therefore, they are liable to service tax under Business Auxiliary Service . 5. Heard the parties, considered the submiss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her person for a consideration then it would be a provision of service. In view of the above discussion, we hold that for the period prior 01.07.2012, the amount recovered by the appellant by way of non-compete agreements are not liable to tax under the Finance Act, 1994. 7. As regards the issue (b), whether the activity undertaken by the appellant falls under the category of Business Auxiliary Service or not For better appreciation, the provisions of Section 65 (19) of Finance Act, 1994 are reproduced as under:- (19) Business Auxiliary Service means any service in relation to, (i) promotion or marketing or sale of goods produced or provided by or belonging to the client; or (ii) promotion or marketing of service provided by the client; or (ii) any customer care service provided on behalf of the client; or (iii) procurement of goods or services, which are inputs for the client; or [Explanation. - For the removal of doubts, it is hereby declared that for the purposes of this sub-clause, inputs means all goods or services intended for use by the client;] (iv) production or processing of goods for, or on behalf of the cl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d the meaning of the expression sales promotion. (vii) The expression sales promotion has been defined in the Oxford Dictionary of Business to mean an activity designed to boost the sales of a product or service. It may include an advertising campaign, increased PR activity, a free-sample campaign, offering free gifts or trading stamps, arranging demonstrations or exhibitions, setting up competitions with attractive prizes, temporary price reductions, door-to-door calling, telephone selling, personal letters etc. In the Oxford Dictionary of Business English, sales promotion has been defined as a group of activities that are intended to improve sales, sometimes including advertising, organizing competitions, providing free gifts and samples. These promotions may form part of a wider sales campaign. Sales promotion has also been defined as stimulation of sales achieved through contests, demonstrations, discounts, exhibitions or tradeshows, games, giveaways, point-of-sale displays and merchandising, special offers, and similar activities. The Advanced Law Lexicon by P. Ramanatha Aiyar, third edition, describes the term sales promotion as use of incentives to get people to buy a p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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