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TMI Blog2023 (6) TMI 1080X X X X Extracts X X X X X X X X Extracts X X X X ..... the farmers viz. Agriculturists registered with them. The activity of the appellant is summarized below: (i) The appellant was allotted certain agricultural areas for procurement of sugar cane cultivated by the agriculturists within the said jurisdiction; (ii) The farmers within the earmarked areas who intend to cultivate sugar cane shall sell their sugar cane to the above factory only. (iii) Wherever harvesting labourers were arranged by the factory, the cane cutting charges will be recovered from the cost of the sugar cane supplied. 3.1 The process of registration of both farmers and cane harvesting labourers and execution of the agreement and other related work is undertaken by the Divisional Offices of the factory. The man-power required for harvesting the sugar cane are procured by the Cane Officer belonging to the factory, who enroll these labourers and make payment of advance to them. The details of these labourers such as their bank account number, the name of the bank are recorded in the records of the Divisional Offices of the factory and thereafter a Harvester Code No., is allotted. As and when the sugar cane cultivated becomes ripe for cutting as per the requirem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missioner of Central Excise and Service Tax, Tiruchirappalli has confirmed the demand of Service Tax of Rs.40,90,147/- under proviso to Section 73(1) of Finance Act, 1994, along with interest under Section 75 of the Finance Act, 1994 and also imposed penalties under Sections 77 and 78 of Finance Act, 1994. Aggrieved, the appellant filed an appeal before the Commissioner of the Customs and Central Excise (Appeals), Tiruchirapalli, who rejected their appeal vide Order-in-Appeal No. 342/2012 dated 29.11.2012. Hence, the factory came in appeal before this forum. 5.1 In the grounds of the appeal, the appellant has submitted that the farmers themselves arrange for cutting / harvesting sugar cane and in cases where the farmers / growers are not able to get persons for cutting / harvesting sugar cane, they used to approach the Cane Officer of the Divisional Office of the factory who would give the names and addresses of the labourers also called as 'Kankhanis' or 'Gang Leaders'. It is submitted that the Kankhanis or Gang Leaders are not employees of the Sugar Mill or Agents of the Sugar Mill, but independent service providers on their own and there is no Master and Servant relationship be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... abhavi Trust vs. CCE, Aurangabad 2014 (36) STR 83 (Tri. Mum.); (ii) CC, CE & ST vs. Godavari Khore Cane Transport Co. (P) Ltd 2015 (38) STR 468 (Bom); Decisions rendered by CESTAT, Chennai: (i) M/s. Kallakurichi Co-operative Sugar Mills Ltd. vs. Commissioner of GST & CE, Final Order No.40217/2020 dated 31.01.2020. (ii) Thiru Arooran Sugars Ltd. vs. CCE, Tiruchirapalli 2019 (2) TMI 493 - (Tri. Chennai). (iii) Arignar Anna Sugar Mills vs. CC, CCE, Trichy 2019 (26) GSTL 54 - (Tri. Chennai). (iv) The Amaravathi Co-op. Sugar Mills Ltd. vs. CCE & ST, Coimbatore 2018 (7) TMI 1837 - (Tri. Chennai). (v) CCE, Tirunelveli vs. M/s. Dharani Sugars and Chemicals Ltd 2018 (1) TMI 1171 - (Tri. Chennai). 9. The appellant also put forth that when the payment was made for cutting / harvesting charges, on tonnage basis, the said transaction could not be treated as supply of man-power. Reliance in this regard is placed on the Board's Circular No.190/9/2015-ST dated 15.12.2015 and the relevant paragraph is extracted below: "1: ... 2. The matter has been examined. The nature of manpower supply service is quite distinct from the service of job work. The essential characteristics of manp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y paid on per tonne basis. There is nothing on record to suggest that the cane cutting labourers are the employees of the appellant. No employer and employee relationship exists between the appellants and the Kankhanis / Gang Leaders. The labourers are not supplied on per hour or per day basis. Cane harvesting charges are reportedly negotiated with the Kankhanis / Gang Leaders by the farmers themselves. Reportedly, some farmers are not utilizing the services of the appellant for obtaining the labourers. As such, the demand raised on the appellant under manpower supply is not maintainable. 14. In a catena of decisions rendered by the Tribunal Chennai, the issue was decided in favour of the appellants holding that the supply of cane harvesting labourers, in similar facts, would not be falling under the manpower recruitment or supply agency service. The decision rendered in the case of Arignar Anna Sugar Mills vs. Commissioner of GST & Central Excise, Trichy [2019 (26) G.S.T.L. 54 (Tri. Chennai)] is relevant which is extracted below: "6. The demand has been made on manpower supply service alleging that the appellant have supplied manpower to the sugarcane farmers for sugarcane harv ..... X X X X Extracts X X X X X X X X Extracts X X X X
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