Chartered Accountant
Bookmark and Share
click here to subscribe our newsletter
 
 
Corporate News *  Missing seized records must be considered while testing ITC claim; duplicate GST demands ordered corrected: Delhi High Court. *  GST appeal can’t be rejected without addressing taxpayer’s grounds: Allahabad High Court. *  Surplus IGST credit can offset CGST, SGST shortfall: GSTAT. *  GST refund can’t be denied when cancelled airfares are returned with tax: GSTAT. *  3 Hearing notices issued within 2 minutes: Gujarat High Court flags portal flaw, seeks report. *  GSTR-9, GSTR-9C filing for FY 2025-26 enabled; pending GSTR-1 and GSTR-3B must be filed first. *  Dupattas are exempt fabrics, can’t be taxed as fibres at 4%: Madras High Court. *  Full transitional credit allowed on capital goods received after GST rollout: GSTAT denies Rs. 6.99 lakh export duty credit. *  GST return mismatch alone can’t justify fraud proceedings: GSTAT orders fresh adjudication under section 73. *  Supplier found non-existent later can’t alone justify input tax credit denial: GSTAT. *  GST interest stops once tax reaches government account, can’t run until return filing: GSTAT. *  Cancelled flat booking- GST refund can’t be denied without excluding COVID period from limitation: GSTAT. *  India notifies rules of origin for India–New Zealand FTA. *  Incomplete E-bike kits classifiable as complete vehicles, but not eligible for CKD duty concession: CESTAT. *  Same GST rate on main input and output can’t by itself bar inverted duty refund: GSTAT. *  Unjust enrichment doesn’t apply to customs refunds from assessments finalised before July 13, 2006: Gujarat High Court. *  CENVAT credit can’t be denied solely because plant And machinery are embedded in earth: Karnataka High Court. *  DFIA exports ineligible for RoDTEP benefits; customs directs repayment with applicable interest. *  Second E-Way bill alone doesn’t prove another supply: GSTAT. *  Bail denied in Rs. 1.19 crore fake GST refund case over risk of accused absconding again: Punjab and Haryana High Court. *  GST registration can be restored after revocation deadline if outstanding dues are paid: Gauhati High Court. *  Multiple GST proceedings over same suppliers: Calcutta High Court directs dept. to share findings for adjudication. *  E-Governance portal services not OIDAR, fixed deposit interest not taxable: CESTAT. *  Rs. 500 Stamp duty required on authority letters for CAs, CMA and GST practitioners in Pune GST division.  *  Rs. 1.10 crore GST refund must be paid in cash after business closure: Allahabad High Court. *  Godown rent attracts 18% GST even when used exclusively for exempt agricultural warehousing: AAR. *  GST portal launches "Multi-State Registration" facility: one master TRN for registration applications across multiple States/UTs. *  RoDTEP scheme extended till 31st December, 2026.  *  Mere disagreement with order can’t override Rs. 20 lakh appeal limit: GSTAT. *  Customs interest can’t be backdated before confiscation liability is determined; nearly 8 year period excluded: Delhi High Court.
Subject News *  GST summons: anticipatory bail maintainable without arrest order, but relief denied in evasion case: Allahabad High Court. *  GST Appeal can’t be decided without hearing taxpayer’s objections to fresh evidence: Allahabad High Court. *  GST ITC can’t be reversed merely because supplier grants discount without reducing tax liability: GSTAT. *  Mere quoting of GST provision is not a valid charge: GSTAT quashes ITC denial. *  Personal hearing mandatory before adverse GST order, even without taxpayer’s request: Rajasthan High Court. *  Parallel bail pleas without full disclosure amount to abuse of process Rs. 43.08 crore GST case sent for fresh hearing: Supreme Court. *  GST refund based on unchallenged advance ruling can’t be recovered using later circular: GSTAT. *  Payment of GST alone doesn’t end interest and penalty liability when tax and interest remain unpaid beyond 30 days of notice: GSTAT. *  GST demand over builders’ 80% procurement rule requires reasoned adjudication: GSTAT. *  Eligible ITC doesn’t automatically entitle taxpayers to compensation cess refund on domestic sales: GSTAT. *  GST confiscation order passed before reply deadline invalid: GSTAT. *  GST interest can’t be retained after tax refund on delayed export receipts: Punjab & Haryana High Court. *  GST appeal can’t be dismissed over pre-deposit shortfall without opportunity To respond: Bombay High Court. *  DGGI SCN can’t be challenged before reply and adjudication:Chhattisgarh High Court. *  GST input tax credit can’t be denied solely due to supplier’s retrospective registration cancellation: GSTAT. *  GST notice must explain fraud allegations; merely repeating section 74 Is not enough:  Himachal Pradesh High Court. *  Audit detection alone can’t justify GST fraud penalty; specific suppression must be proved: GSTAT. *  GST order uploaded only under ‘Additional Notices’ tab without separate intimation set aside: Calcutta High Court. *  Service Tax appeal can’t be rejected for missing pre-deposit proof when payment is already recorded: CESTAT. *  SGST dept. can’t hear appeal against CGST order: Calcutta High Court. *  Mere dispatch of tax order can’t prove service or make appeal time-barred: CESTAT. *  Dealer incentives can’t be taxed merely on ledger entries: CESTAT. *  DGFT orders quashed for failure to supply DRI letter relied upon in SCN: Bombay High Court. *  GST penalty u/s 122(1A) can’t apply to Pre-2021 transactions; unregistered beneficiaries also covered: Delhi High Court. *  Expired E-way bill caused by wrong PIN code can’t justify GST penalty without intent to evade tax: GSTAT. *  Used railway rails can’t be taxed as track material without proof they are fit for reuse: CESTAT. *  Earlier DGGI notice doesn’t bar separate GST demand on different issue: Delhi High Court. *  ITC dispute involves no question of law: GSTAT directs appeal to Vice-President. *  Earlier DGGI notice doesn’t bar separate GST demand On different issue: Delhi High Court. *  No E-way bill required for interstate goods movement in november 2017: GSTAT quashes detention and penalty.  

Comments

Print   |    |  Comment

PJ/Case Law /2016-17/3271

Whether service tax leviable on conversion from Aluminium Ingots to Aluminium castings on job work?

Case:- MANISH ENTERPRISES VERSUS COMMISSIONER OF CENTRAL EXCISE, PUNE-I
 
Citation:- 2016 (42) S.T.R. 352 (Tri. - Mumbai)
 
Brief Facts-The facts of the present case are that the appellant is providing the job work by converting Aluminium Ingots to Aluminium casting which amounts to manufacture. The Revenue contended that appellant is providing labour which falls under ‘Manpower Recruitment Agency Services’, accordingly they are liable to pay Service Tax for the period 2007-08 and 2008-09. The adjudicating authority has confirmed the demand and imposed penalty. Aggrieved by the said adjudication order appellant filed appeal before the Commissioner (Appeals) who upheld the Order-in-Original by passing the impugned order therefore appellant appeared before the Tribunal.
 
Appellant’s Contentions:-Ms. Padmavati Patil, ld. Counsel for the appellant submits that they deputed the man power to carry out the job work on the basis of quantum of production on the material supplied by their client. The payment for the labourers is not made towards salary/wages on the basis of number of labourers, payment is made on the basis of quantum of production carried out by the job worker, therefore they are not providing manpower. They are only carrying out job work for their client. The activity amounts to manufacture which is excluded from the provisions of Service tax under the head of ‘Business Auxiliary Services’ on behalf of the client. She also submits that in any case the job work on the material supplied by the client is exempted service by virtue of Notification No. 8/2005-S.T., dated 1-3-2005. In support of her submission, she placed reliance on the judgments in case of Hemant V. Deshmukh v. Commissioner of C. Ex., Goa [2014 (35) S.T.R. 602 (Tri.-Mumbai)].
 
Respondent’s Contentions:-  On the other hand, Shri S.L. Karoliya, ld. Asstt. Commissioner (AR) appearing on behalf of the Revenue reiterates the findings of the impugned order.
 
Reasoning Of Judgement:- The Tribunal carefully considered submissions made by both sides. The undisputed fact in this case is that appellant has carried out job work on behalf of their client, i.e., conversion of Aluminium Ingots to Aluminium Castings. The charges for the job work are based on the quantum of production and not against supply of manpower. Therefore activity remains as production on behalf of the client in the factory of the client. In this fact though the appellant was deputing the manpower but services which carried out were job work in the client’s factory, the said activity amounts to manufacture, hence, does not fall under category of Manpower Recruitment Services. Since activity of the appellant amounting to manufacture of the goods, even it is not covered under Business Auxiliary Services, as manufacturing activity stands excluded in the definition to Business Auxiliary Services. We also agree with the ld. Counsel that if it is considered as taxable activity, the same is exempted under Notification No. 8/2005-S.T., dated 1-3-2005. On going through judgment cited by the ld. Counsel, we find that the ratio of the judgment squarely applicable to the facts of the present case. In view of the above discussions, we set aside the impugned order and allow the appeal of the appellant with consequential relief, if any, in accordance with law.
Decision:- Appeal allowed.
 
Comment:-The gist of the case is that since the assessee carried out the job work of conversion of Aluminium Ingots into Aluminium Castings in client’s factory and on their behalf and charges thereof were received on the basis of quantity produced and not against number of labourers deputed, therefore such an activity amounts to manufacture and hence, not covered under Manpower Recruitment Agency service under Sections 65(68) and 65(105)(k) of Finance Act, 1994.This activity is also not covered under Business Auxiliary service. Therefore service tax is not leviable.
 
Prepared By:- Praniti Lalwani
 
 

Department News


Query

 
PRADEEP JAIN, F.C.A.

Head Office : -

Address :
"SUGYAN", H - 29, SHASTRI NAGAR, JODHPUR (RAJ.) - 342003

Phone No. :
0291 - 2439496, 0291 - 3258496

Mobile No. :
09314722236

Fax No. :0291 - 2439496


Branch Office : -

Address:
1008, 10th FLOOR, SUKH SAGAR COMPLEX,
NEAR FORTUNE LANDMARK HOTEL, USMANPURA,
ASHRAM ROAD, AHMEDABAD-380013

Phone No. :
079-32999496, 27560043

Mobile No. :
093777659496, 09377649496

E-mail :pradeep@capradeepjain.com