Case Law Details
A. Natarajan Vs Commissioner of GST & Central Excise (CESTAT Chennai)
CESTAT Chennai held that contract is for performance of the work and not for supply of manpower. Further, payments are for the works executed on tonnage basis/ unit basis and not on man hours or per person basis. Accordingly, service tax not payable on ‘Manpower Recruitment or Supply Agency Services’ (MRSAS).
Facts- The appellant was registered under the category of “Manpower Recruitment or Supply Agency Service” (MRSAS). It appeared to the department that the appellant provided MRSAS for the work of water cooling system pipeline laying to M/s.BHEL, Trichy during the period January 2011 to March 2011 and received payment from M/s.BHEL Trichy. The appellant did not discharge service tax on the payments received from M/s.BHEL, Trichy and was liable to pay service tax of Rs.66,642/- under the category of MRSAS.
Show cause notice was issued to the appellant demanding service tax along with interest and for imposing penalty. After due process of law, the original authority confirmed the demand along with interest and imposed penalty. On appeal, Commissioner (Appeals) upheld the same. Hence the appeal.
Conclusion- Held that the contract is for performance of work and not for supply of manpower. This is established from the invoices raised for payment made to the appellant. The payments are for the works executed on tonnage basis / unit basis and not on man hours or per person basis.
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