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Charges levied on the basis of activities and material involved and not on the basis of number/nature or scope of manpower cannot fall under the category of “Manpower Supply and Recruitment Services”.
Facts:
Respondents undertook work as incidental to fabrication of Iron Steel Products supplied by the manufacturer. Department alleged that they provided services of Supply of Manpower. It was argued that the consideration is received and charged on per metric ton of output and is done on a job basis which was supported by the invoices. The First Appellate authority cancelled the demand, against which revenue is in appeal.
Held:
The Tribunal concurred with the views of the first appellate authority who noted that the charges do not have any nexus with the number/nature/scope of manpower supply and charges pertained to various types of activities and quantity of material involved. Further, the activity was with respect to goods which were still on the production line of the manufacturer, therefore the respondents were entitled to the benefit of exemption notification no. 8/2005-ST which exempts the taxable service of production of goods on behalf of the client. Relying on the decision of M/s. Ritish Enterprises vs. CCE, Bangalore [2010 (18) STR 17 (Tri.-Bang) the order of the first appellate authority was confirmed. A similar decision was also rendered in the case of Commissioner of Central Excise, Nagpur vs. Shri GM Mate, Shri Babulal Ladse [2015-TIOL-1663- CESTAT-MUM].
