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TMI Blog2021 (3) TMI 465X X X X Extracts X X X X X X X X Extracts X X X X ..... loyees of M/s Yutaka, Japan and worked for the appellant during the period of secondment. The appellant paid their salaries directly to them after making some deductions towards tax deduction at source (TDS), provident fund etc., as applicable. During the audit of the appellant's records, the audit team felt that the above activity amounted to the parent organisation from Japan supplying manpower to the appellant which is a taxable service. Therefore, it was felt that under Reverse Charge Mechanism (RCM) the appellant, as the recipient of "Manpower supply service" from their parent organization M/s Yutaka, Japan, was liable to pay service tax on the amounts paid as salaries to these employees of the parent company working with the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enalty under Section 78 was absent. 4. At the outset, learned Counsel for the appellant submits that it is a common practice for Indian subsidiaries of Multinational Corporations to get experts and staff on secondment from parent companies. While they are working with the Indian company their salaries are paid by the Indian company and all necessary deductions, such as, provident fund and TDS, are made by the Indian company. The contention of the Department that this arrangement amounts to the parent company providing "manpower supply agency services" to the Indian subsidiary has been rejected by the Tribunal in the case of Volkswagen India (Pvt.) Ltd. versus Commissioner of Central Excise, Pune - I - 2014 (34) S.T.R. 135 (Tri. - Mum.). An ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation India Pvt. Ltd. - 2015 (37) S.T.R. 62 (All.). Learned Counsel submits that it is not in dispute that they were paying the salaries for the expert and staff who were sent by the parent organization and have made deductions towards Provident Fund, TDS etc. This arrangement does not amount to supply of manpower by the parent organization as the deputed experts and staff will be their employees for the period when they are working with them. As the issue has already been decided by various Benches of Tribunal and upheld by the Hon'ble Supreme Court in the cases as mentioned above, nothing survives in this order-in-original which needs to be set aside in toto. 6. He further submits that while the impugned order invoking extended period of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... employees of the Indian company. The parent company is not supplying manpower to Indian company. Therefore, no service tax is payable under Reverse Charge Mechanism by the Indian company on the salaries, etc. paid to the deputed employees. In the assessee's own case, for a period subsequent to the period of dispute, the learned Commissioner (Appeals) himself has also decided so which order has not been appealed against by the Revenue. Thus, the issue has also reached finality in the assessee's own case. We, therefore, see no reason to hold that this arrangement is supply of manpower by the parent company to the appellant. Consequently, nothing survives and the demand, interest and penalty imposed and the impugned order cannot be sustained. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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