TMI Blog2023 (8) TMI 854X X X X Extracts X X X X X X X X Extracts X X X X ..... very same activity under the category of Business Auxiliary Service and sub head production of goods on behalf of the clients . It can be seen that in clause (v) of the definition of Business Auxiliary Service, though the production of goods on behalf of the client is a taxable service, however, any activity that amounts to manufacture within the meaning of clause (f) of Section 2 of the Central Excise Act, 1944 is out of the ambit of the definition of Business Auxiliary Service. The Revenue has completely misunderstood the definition of business auxiliary service particularly with regard to the service of production of goods on behalf of the client. From the definition it is absolutely clear that all such production activities which a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Respondent ORDER RAMESH NAIR The brief facts of the case are that the appellant are engaged in the activity of manufacturing of drugs like Tetracycline, Neocycline etc as a loan licensee for various companies. The case of the department is that since the drugs manufactured by the appellant are exempted from payment of central excise duty. Hence, the appellant is liable to pay service tax under the category of business auxiliary service on the gross amount received by the appellant for manufacture and supply of the drugs. 2. Shri Amal Dave, Learned Counsel appearing on behalf of the appellant at the outset submits that the activity carried out by the appellant is admittedly a manufacturing activity of excisable goods i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ow cause notice. The relevant portion of the show cause notice is reproduced below: - 2. During the course of Audit conducted under Computer Assisted Audit Program (CAAP), it has been observed that the party has manufactured certain Goods viz. Tetracyline, Neocycline etc. falling under Chapter 30 of the Central Excise Tariff Act, 1985 and Animal Feed supplements Feritas Bolus, Ecot Bolus falling under Chapter 23 of the Central Excise Tariff Act, 1985 on behalf of their clients under loan licenses issued by the Drugs Authorities, which are exempt from the Central Excise Duty. Such services rendered to the clients in the form of manufacture of Goods which are exempt from Central Excise Duty are covered under Business Auxiliary Services a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nventory management, evaluation or development of prospective customer or vendor, public relation services, management or supervision, and includes services as a commissions agent, but does not include any information technology service and any activity that amounts to manufacture within the meaning of clause (f) of section 2 of the Central Excise Act, 1944. 4.1 From the above definition it can be seen that in clause (v) of the definition of Business Auxiliary Service, though the production of goods on behalf of the client is a taxable service, however, any activity that amounts to manufacture within the meaning of clause (f) of Section2 of the Central Excise Act, 1944 is out of the ambit of the definition of Business Auxiliary Servi ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
