Mars Mountain Security Services Private Limited Vs Commissioner of Central Excise & Service Tax (CESTAT Kolkata)
The Central Excise and Service Tax Appellate Tribunal (CESTAT) Kolkata recently delivered a judgment in the case of Mars Mountain Security Services Private Limited vs Commissioner of Central Excise & Service Tax. The ruling has significant implications for the tax liabilities of companies providing manpower as accounts executives, store-keepers, and draftsmen. Specifically, the tribunal held that such manpower supply services were not subject to service tax for the period prior to June 16, 2005.
Background of the Case
The appellant, Mars Mountain Security Services Private Limited, had been providing various services like security service, manpower supply, housekeeping, and civil contracts. They were challenged on the ground that they had not paid adequate service tax between October 2001 and March 2006, especially on the manpower supply and housekeeping services.
Key Points of Contention
Discrepancy in Reporting: The appellant was accused of underreporting their revenues in their Service Tax returns (ST-3), leading to a potential tax liability of Rs. 65,24,118/-.
Tax Liability Classification: Revenue authorities claimed that the services provided by Mars Mountain Security Services fell under ‘manpower recruitment agency service’, thus making them liable for service tax from as far back as 1998.
Limitation Period: The appellant argued that the demand for back taxes was issued after the expiration of the standard limitation period.
