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TMI Blog2024 (12) TMI 1454X X X X Extracts X X X X X X X X Extracts X X X X ..... . whether transportation of documents and goods and other liaison works amounts to service under the category of 'Manpower Recruitment or Supply agency" services; v. Whether the appellant is eligible for the benefit of Notification No. 30/2012-ST dated 20.06.2012. 2. In Appeal No. ST/23314/2014, the appellant is challenging the impugned order dated 16.05.2014, which was issued against show cause notice dated 05.04.2013 for the period from 2007-08 to 2011-12. As per the order, the adjudication authority confirmed demand of service tax amounting to Rs. 22,77,721/- by invoking the extended period on the ground that they have short paid service tax under the category of 'Cleaning activity' Service. Similarly for the period from 2008-09 to 2011-12, adjudication authority confirmed service tax of Rs. 37,13,249/- considering the activity carried out by the appellant as falling under the category of 'Packaging activity' Services. Adjudication authority confirmed interest for the delayed payment and also imposed penalties under the provisions of the Finance Act, 1994. Similarly, against the show-cause notice dated 10.11.2008 for the period from 16.06.2005 to 30.09.2007, adjud ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 39;Manpower recruitment or supply agency' service. However, when the show cause notice was issued for the subsequent period, same 'Manpower recruitment or supply agency' service is reclassified, and demand was made under the category of 'packaging activity' services. 5. When the appeals came up for hearing, learned counsel for the Appellant submitted that the demands confirmed by invoking the extended period of limitation is unsustainable since there is no suppression of facts and Learned Counsel relied on following decisions in support of the same. i. Ewac Alloys Limited-1995(80) ELT 759 (Bom.) ii. Central Excise Vs. Chemphar Drugs And Liniments-1989 (40) ELT 276 (SC) iii. Pushpam Pharmaceuticals Company Vs. CCE. Bombay [1995 (78) ELT 401 (SC)] iv. Dye Chemical Vs. Cce, Bombay-1995(75)ELT 721 (SC) v. Easland Combines Vs. CCE, Coimbatore 2003-Tiol-26-SC-Cx vi. Uniworth Textiles Vs. CCE, Raipur -2013(288)Elt 161(SC) 6. On merit, Learned Counsel submitted that the Appellant is engaged in carrying out proper maintenance and hygiene of the Rolling stock of Indian Railway. The cleaning of rolling stocks was carried out in the open yard. The Learned Coun ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ly of manpower, temporarily on otherwise, to any other person. On analysis of the activity carried out by the appellant, transportation of documents and goods as per requirement, to the external entity with definition cited above indicate that no manpower is supplied as such by the Appellant, but manpower is used by the Appellant to perform the activity as required by M/s HLL Life Care Ltd. Appellant was providing service for transportation of goods to destinations and also to engage in liaison works. Since the activity is falling mainly under transportation of goods, the service tax is payable by the service recipient under reverse charge. Hence the demand confirmed as per the impugned orders merits to be set aside. The Appellant had paid service tax by mistake considering it under the category of 'Manpower Recruitment and supply agency' Services. Therefore, the impugned order confirming the service tax under the category of 'Manpower recruitment or supply agency' services is unsustainable. 9. Further the Learned Counsel submitted that the gross amount considered as consideration for assessing service tax is also unsustainable, since it is an employer-employee rel ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of limitation is unsustainable in the absence of any allegation of fraud or collusion, imposing penalty is also unsustainable. 11. Regarding appeal No. ST/21868/2018, the Learned Counsel submitted that the demand is unsustainable. Department had issued different show cause notices earlier demanding service tax under 'Manpower recruitment and supply agency' services as per Section 65(105)(k) read with section 65(68) of the Finance Act, 1994, "Cleaning Services' and also under the category of 'Packaging activity' Services. Apart from that, the show cause notices have culminated into orders-in-original and appeals are pending before this Tribunal. The activities rendered by the Respondent in the above cases were classified as 'Manpower recruitment or supply agency' services or 'Packaging activity' services. Even though the definition had undergone changes from 01.07.2012, the accounting code of the services remained same as that of the earlier period indicating the recognition of the activity under 'Manpower recruitment or supply agency' services. The 'Manpower recruitment or supply agency' services were subjected to different changes in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sions made by the Respondent before the adjudicating authority, the demand was dropped by stating specific reasons and appeal is liable to be dismissed. 13. Learned counsel for the Assessee further submitted that either in the Review order or in the Grounds of appeal, any other specific service is suggested so as to deposit the tax under specific accounting code, if a favourable order is issued. It is a settled issue that mere suspicion is not enough to sustain a demand but well founded facts are necessary. In this case, para 9 of the impugned order spelt out the reasons as to why the demand is dropped. The impugned order specifically states about the verification of the invoices issued by the Respondent and about the show cause notice no. 22/2017-18 ST(AC) dated 20.11.2017 issued by the Assistant Commissioner (Audit) classifying the activity as "Man Power Recruitment or Supply Agency" Services. The order further states about applicability of Notification No. 30/2012-ST dated 20.6.2012 read with Notification No. 07/2015 ST dated 1.3.2015 and concluded the classification of the activity under 'Man Power Recruitment or Supply Agency Services". Vide para 10 of the impugned order, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te. Further in the matter of Cosmic Dye Chemical Vs. CCE, Bombay - 1995 (75) E.L.T. 721 (S.C), the Apex Court held that to invoke the extended period of limitation, there must be an intention to evade duty. In Appellant's case, the services were all given to Central Government Institutions or Institutions like HLL Lifecare Ltd., IISER, BSNL, IIST, Southern Air Command and they are liable to bear the service tax even, if the appellant had paid the service tax. The 'Cleaning activity' services were provided to Indian Railway and as per the communication made by the appellant with Indian Railway, they have refused to pay service tax on the ground that service tax is not applicable for cleaning services provided to Indian Railway as per the decision of the Tribunal in M/s R.K. Refreshment & Enterprises (P) Ltd. 2018 (14) GSTL 281 (Tri.-Del.), Similarly, Apex court in the matter of Continental Foundation Jt. Venture Vs. Commr. of C. Ex., Chandigarh-I (1995 (78) E.L.T. 401 (S.C.)) held That :- "12. As far as fraud and collusion are concerned, it is evident that the intent to evade duty is built into these very words. So far as mis-statement or suppression of facts are concerned ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ated 01.07.2002, such activity can be considered as manufacture, and it is beyond the scope of service tax. Hence, entire demand under the category of 'Manpower Recruitment and Supply Agency' Services or under 'Packaging activity' services on the consideration received from M/s. HLL Life Care is set aside. 20. Regarding Service Tax demand by considering the gross amount as consideration, though the Hon'ble High Court of Kerala in the matter of M/s. Security Agencies Association (supra) held that salary and statutory payment of security personal can be included as consideration, only by following the ratio of the judgment of the Hon'ble Supreme Court in the matter of Intercontinental consultants and Technocrats Pvt., Ltd., (supra) and considering the nature of contract to find out whether appellant had received the consideration as pure agent, service tax can be quantified. 21. As regarding demand of service tax for providing transportation of document, the activity cannot be considered as 'Manpower, recruitment or Supply' services, since the consideration was determined on the basis of distance for carrying the document belonging to M/s. HLL Lifecare and it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 ST dated 20.06.2012 being doubtful, the Department is constrained to consider the services rendered by the assessee as other taxable services and demand the tax as payable by the provider." However, as evident from the show cause notice, the Adjudication Authority relied on ST-3 returns for the period from 2015-1616 and 2016-17 as relied upon documents to issue the show cause notice. Further, only after taking note of the above, the adjudication authority considered the previous proceedings and dropped the demand. Considering the above and considering the finding regarding lack of evidence on record as discussed in ibid paras for invoking the extended period of limitation, against the demand for the period from 2015-16 to 2016-17 in Appeal No. ST/21861/2018 filed by the department demand of Service Tax is unsustainable. As regards the demand of duty as short paid for the period from April 2012 to March 2015 amounting into Rs.14,99,600/-, the appellant is liable to pay service tax under 'Manpower Recruitment or Supply Agency Services' and 'Cleaning activity' services, the appellant is eligible for the benefit of Notification No. 30/2012-ST dated 20.06.2012 and bein ..... X X X X Extracts X X X X X X X X Extracts X X X X
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