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TMI Blog2023 (9) TMI 808X X X X Extracts X X X X X X X X Extracts X X X X ..... ng of goods on behalf of their clients. Therefore, the said activity is liable to leviable to service under the category of "Business Auxiliary Service". 2.2 Accordingly, proceedings were initiated by issuing show-cause notice for the period 2005-06 to 2009-2010 and the matter was adjudicated. The demand of service tax was confirmed under the category of "Business Auxiliary Service". 2.3 Aggrieved with the said order, the appellant is before us. 3. The ld.Counsel for the appellant submits that the issue has been settled by this Tribunal in the case of Ferro Scrap Nigam Liemited Vs. Commissioner of CGST & Excise,Bolpur vide Final Order No.75013- 75014/2021 dated 19.01.2021 wherein it has been held that during the impugned period, such activity was not liable to pay service tax under the category of "Business Auxiliary Service". Therefore, the impugned order is to be set aside. 4. On the other hand, the ld.A.R. for the Revenue reiterated the findings of the impugned order. 5. Heard both the parties and considered the submissions. 6. We find that the said issue came up before this Tribunal in the case of Ferro Scrap Nigam Limited (supra), wherein this Tribunal has observed as un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iled activity undertaken by the appellant vide which they separate the iron metal from the molten slag. As such we do not feel the need of referring the same, as the dispute does not revolves around the said activity, but relates to as to whether the said activity can be called as "production of goods" and further "on behalf of the client". As regards the expression "production of goods", we note that the same was amended in June 2005 and was substituted by the expression - "processing" of goods. As such it is clear that prior to the amendment and in the absence of the words "processing" the same has to be interpreted in a manner that the activity results in production of goods. We may here observe that every production may not amount to manufacture but admittedly every manufacturing activity involves production of goods, inasmuch as the term "manufacture" would include production though every production may not include the manufacturing activity. Inasmuch as the Commissioner in his order dated 21-9-2006 has held that the said activity does not amount to manufacture and such order stands accepted by the Revenue, it has to be held that there was no production of goods. As such we ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tribunal settling the issue at rest. In the case of Auto Coats - 2009 (15) S.T.R. 398 (Tri.-Chen.) it stands held that prior to 16-6-2005 unless a person was engaged by another for processing the goods entrusted by a third person, such activity would not be exigible to service tax. Similarly in the case of Sonic Watches Ltd. - 2011 (21) S.T.R. 34 (Tri.) it was held as under : "5. We find that activity undertaken by the appellants in this case was similar to the one as existed in the case of Auto Coats. Therefore, in the light of above two decisions discussed above, it cannot be said that appellants have undertaken job work on behalf of the clients, in view of the fact that there were only two parties to the transaction in this case, whereas where the production is on behalf of the clients, there would be three parties. Since, services undertaken by the appellants is not covered by the definition, no service tax is attracted. Accordingly, impugned order is set aside and appeal is allowed". Further, in the case of Rathour Engg. Works - 2012 (27) S.T.R. 37 (Tri.- Del.), the Tribunal held as under :- "6. The appellants carry out the process of grinding and smoothening the edg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... exercise of the powers conferred by sub-section (1) of Section 93 of the Finance Act, 1994 (32 of 1994) (hereinafter referred to as the Finance Act), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts the taxable service of [production or processing of goods for, or on behalf of, the client] referred in sub-clause (v) of clause (19) of Section 65 of the said Finance Act, from the whole of service tax leviable thereon under Section 66 of the said Finance Act : Provided that the said exemption shall apply only in cases where such goods are produced [or processed] using raw materials or semi-finished goods supplied by the client and goods so produced [or processed] are returned back to the said client for use in or in relation to manufacture of any other goods falling under the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986), as amended by the Central Excise Tariff (Amendment) Act, 2004 (5 of 2005), on which appropriate duty of excise is payable. Explanation. - For the purpose of this notification, - (i) the expression "production [processing] of goods" means working upon raw materials or semi-fini ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ), it stands clearly held by the Tribunal that service of shifting, transportation or raw materials, waste materials, and finished products from one place to another, inside the plant itself, does not fall under the taxing category of Cargo Handling Services. The activities undertaken by the appellant are admittedly within the plant itself. As such, we find that the ratio of the law declared by he Tribunal in the above referred matter, which also stands upheld by the Hon'ble Jharkhand High Court, is fully applicable to the facts of this case." 10. In view of the aforesaid, the issue is no longer res-integra, since decided in favour of the assessee. We do not find any reason to take contrary view and therefore, the demand raised vide the impugned adjudication order cannot be sustained and hence, the same is set aside. Consequently, the appeal filed by Revenue to dispute the cum tax benefit is liable to be rejected since there cannot be demand of service tax as held above. 11. The appeal filed by assessee is thus allowed with consequential relief as per law. The appeal filed by Revenue is rejected." 7. As the issue has been settled in favour of the appellant, therefore, the a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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