Case Law Details
Bhaurao Chavan SSK Ltd Vs C.C.E. & S.T (CESTAT Mumbai)
The issue involved is whether the appellants are liable to pay Service Tax on the rent received by them for allowing the harvesting contractors to use the Appellant’s bullock carts with tyres without any bullocks or driver for transporting the sugarcane to the sugar factories?
The appellants are engaged in the manufacture of sugar and molasses. They are also providing bullock carts on rent basis to the farmers for transportation of sugar cane to its sugar factory.
The appellants submits that the Appellants supplied only the bullock carts with tyres and not bullocks to the farmers nor they provide any driver for driving the bullock carts to the farmers. According to him the effective control and possession of the bullock carts does not lie with the appellants. According to learned counsel, the bullock carts cannot come under the category of ‘Supply of Tangible Goods for use’.
A plain reading of Section 66D(d)(iv) ibid would make it clear that the services relating to agricultural or agricultural produce by way of renting or leasing of agro machinery is outside the purview of Service Tax. Undoubtedly sugarcane is an agricultural produce and as per various dictionary meanings tyre bullockcart very well falls within the definition of agro or agricultural machinery.
Please become a Premium member. If you are already a Premium member, login here to access the full content.
Author Bio
