TMI Blog2023 (1) TMI 507X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellant manufactured them on which the appellant has been paying appropriate central excise duty - In any contract of job work, an agreement is entered into whereby an amount is paid to the job worker by the principal. If the job worker undertakes an activity which amounts manufacture, it has to pay appropriate central excise duty. In this case, the appellant has paid central excise duty. Thereafter, the appellant sold the goods to M/s Gillette India Ltd. in terms of the purchase agreement. Such sale or purchase is not a taxable service and no service tax can be charged on it. The entire case of the Revenue rests on the fact that in the books of account the appellant has recorded the amounts received on account of job work as per the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r willful mis-statement and suppression of facts; IV. Since equal penalty is being imposed under section 78. I refrain from imposing penalty under section 76 in view of proviso to section 78 of the Finance Act, 1994 for failure to pay Service Tax. V. I impose penalty of Rs. 10,000/- (Rupees Ten Thousand only) under section 77 of the Finance Act, 1994 for non registration under Service Tax and for non filing of returns . 2. The facts of the case, in brief, are that the appellant is registered with the Central Excise Department and manufactures Razors and Blades for M/s Gillette India Ltd. under an agreement. The appellant has been paying appropriate central excise duty on the goods cleared by it. During audit, it was observed that a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to the agreement. There is no allegation or evidence that any amount other than this is received by the appellant. He took us through the purchase agreement which indicates that the appellant is the seller and M/s Gillette India Ltd. is the buyer. Clause II of the agreement indicates the nature of goods to be purchased, the specifications, the production process to be followed and the raw materials to be used. Clause III of the agreement deals with the acceptance, return, revoke, scrapping, quality control, third party testing, quality assurance elements. Clause IV of the agreement deals with the quantity to be purchased, reduction or discontinuance of the purchases etc. Clause V deals with prices and taxes. Clause VI deals with the contrac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e (a) service provider; (b) service recipient; (c) service (d) a consideration for such service and (e) such service must be taxable service. The case of the Revenue in this appeal is that the appellant received amounts from M/s Gillette India Ltd. under the head Management Fees, which is chargeable to service tax under section 65 (105) (r) of Finance Act, 1994. The amounts in question, were received undisputedly in terms of Annexure I to the purchase agreement between M/s Gillette India Ltd. and the appellant. The nature of the agreement makes it clear that it was an agreement for sale of goods by the appellant to M/s Gillette India Ltd. as per the specifications of the latter. To sell these goods the appellant manufactured them on which t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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