Case Law Details

Case Name : Shri Dnyaneshwar Trust Vs Commissioner of Central Excise, Mumbai (CESTAT Mumbai)
Appeal Number : Order No. A/652/2012/CSTB/C-I
Date of Judgement/Order : 03/10/2012
Related Assessment Year :


Shri Dnyaneshwar Trust


Commissioner of Central Excise, Mumbai

ORDER NO. A/652/2012/CSTB/C-I
APPEAL NO. ST/238 OF 2012

OCTOBER  3, 2012


Ashok Jindal, Judicial Member

Heard both sides.

2. The appellant has filed this application for waiver of pre-deposit of duty of Rs. 1,43,60,622/-, interest and penalties. The demand is confirmed on the ground that the appellant provided ‘Business Auxiliary Service’ and received some amount from the sugar manufacturers on which appropriate service tax has not been paid. The contention is that the appellant is undertaking the activity of harvesting and transportation of sugarcane from the farmer field to the sugar factory and to coordinating such activities the appellants are paying service tax in respect of harvesting and transportation of sugarcane. The appellant is receiving certain amounts for rendering the above service, which was shown in the Books of Account as commission. The contention in the impugned order, (para 6.3) is that the appellant has acted as commission agent and the commission agent is also covered under the scope of “Business Auxiliary Service”. The appellant claims the benefit of Notification No.13/2003-ST dated 20/06/2003, which provides exemption in respect of “Business Auxiliary Service” provided by commission agent in respect of agricultural products from service tax. The contention is that the appellant is dealing with sugarcane which is an agricultural produce hence, the appellant is entitled for the benefit of Notification. Hence, the demand is not sustainable.

3. The ld. AR submitted that the appellant is engaged in providing manpower & transport of goods services for sugarcane harvesting and transportation and undertaking procurement of inputs for the sugar manufacturers therefore, the appellant is providing the “Business Auxiliary Service” hence, this activity is not exempted. Hence, the appellant is liable to pay service tax in respect of the amounts received in this regard.

4. We find that the adjudicating authority in the impugned order held that the appellant has undertaken the activity of harvesting sugarcane and its transportation to sugar factory from the fields of farmers and this activity is in relation to sale of sugarcane by farmers and purchase of sugarcane by the sugar factory and service provided by a commission agent. In view of this finding, we find that the appellant is entitled for the benefit of Notification No. 13/2003-ST which provides exemption from payment of service tax in respect of service provided under “Business Auxiliary Service” in relation to the sale of agricultural products.

5. In view of these observation, the appeal is allowed with consequential relief, if any and the impugned order is set aside.


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