TMI Blog2024 (3) TMI 1166X X X X Extracts X X X X X X X X Extracts X X X X ..... manufacture and the appellant is doing the said activity on job work basis and such job worked goods have suffered duty at the end of the principal manufacturer, in these circumstances, the demand of Service Tax under the category of business auxiliary service is not sustainable against the appellant. The impugned order set aside - appeal allowed. - HON BLE SHRI ASHOK JINDAL, MEMBER (JUDICIAL) And HON BLE SHRI K. ANPAZHAKAN, MEMBER (TECHNICAL) Smt. Sweta Mukherjee, Advocate for the Appellant Shri S.S. Chattopadhyay, Authorized Representative for the Respondent ORDER Order : [ Per Shri Ashok Jindal ] The appellant is in appeal against the impugned order wherein demand of Service Tax has been confirmed against the appellant under the category of business auxiliary service for the activity carried out by them of processing of cutting, grinding, drilling and machining of forged black wheels / axles supplied by M/s. Durgapur Steel Plant. 2. The facts of the case are that the appellant is engaged in the activity of cutting, grinding, drilling and machining of forged black wheels / axles on job work basis supplied by the principal viz. M/s. Durgapur Steel Plant. The inputs are received ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... definition of BAS was as under: (19) business auxiliary service means any service in relation to - (i) promotion or marketing or sale of goods produced or provided by or belonging to the client; or (ii) promotion or marketing of service provided by the client/ or (iii) any customer care service provided on behalf of the client; or (iv) procurement of goods or services, which are inputs for the client; or (v) production of goods on behalf of the client; or (vi) provision of service on behalf of the client; or (vii) a service incidental or auxiliary to any activity specified in sub- clause (i) to (vi) such as billing, issue of collection or recovery of cheques, payments, maintenance of accounts and remittance, inventory management, evaluation or development of prospective customer or vendor, public relation services, management or supervision, and includes services as a commission 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 . 5. As such, as seen from the above reproduced definition of BAS a service provider has to produce the goods on behalf of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ovision of service on behalf of the client. This is because the taxable activity envisaged under this category of business auxiliary service is that while the client is obliged to provide some service to a 3rd person but instead of the client providing such service, the service provider provides the such service to the 3rd person, on behalf of the client i.e. acting as an agent of the client. Admittedly, in the instant case, there is no 3rd person. Thus, the activity as undertaken does not fall under business auxiliary service or any other existing taxable services . Circular No. B1/6/2005-TRU, dated 27 Jul. 2005 24.1 One of the taxable activities prior to amendment by Finance Act, 2005 under business auxiliary service was production of goods on behalf of the client The activities that amount to manufacture within the Central Excise Act were not covered within the scope of the taxable service. Amendments have been made to define this taxable activity as production or processing of goods for, or on behalf of, the client . The condition that only such activities would be liable to service tax which do not amount to manufacture under Central Excise Law would, however, continue. 24.2 A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing of goods for, or on behalf of, the clients. In view of this, the impugned order is not sustainable. The same is set aside. The appeals as well as the stay applications are allowed . 11. In view of our foregoing discussions, we hold that the appellant s activity prior to June 2005 cannot be held to be exigible to service tax under the category of BAS. Accordingly, we set aside the impugned order and allow the appeal with consequential relief to the appellant. Inasmuch as we have held in favour of the appellant on merits, we do not think it necessary to deal with the appellant s plea of limitation. Appeal is disposed of in the above manner. 8. Further, for the period after 16.06.2005, the Tribunal in their own case as reported in 2019 (2) TMI 766 CESTAT Kolkata, has held that the assessee is entitled to exemption under Notification no. 8/2005 dated 01.03.2005. The relevant portion of the decision is reproduced below: 9. Next we consider the liability for the period w.e.f. 16-6-2005. When we consider the definition in sub-clause (v) of Section 65(19) for the period prior to and subsequent to 16-6-2005, we note that for the later period, the definition has included processing of go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aterial for use in melting and further manufacture within the iron and steel plant. 11. On behalf of Revenue, the Ld. DR has further raised a doubt about the satisfaction of the condition of the second limb of the notification i.e. to the effect that the processed goods have been returned back to the client and the same has been further used in the manufacture of other goods, on which appropriate duty of excise is payable. In this connection, we note that the Ld. Advocate on behalf of the appellant, has submitted a certificate, dated 4th September, 2009, issued by M/s. SAIL, Bokaro Steel Plant, wherein the Deputy General Manager (F A) has certified that the scrap, after processing and recovery, has been returned back and the same has been used for the manufacture of dutiable steel products. Giving due consideration to such end-use certificate submitted by the Public Sector Undertaking, we are of the view that the appellant will be entitled to the benefit of Notification No. 8/2005, dated 1-3-2005. Consequently, we set aside the demand for service tax made in the impugned order and allow the appeal. 9. With regard to the demand raised on shifting, transportation, loading and unloadi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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