Custom, Excise & Service Tax Tribunal
N/S. Indag Rubber Ltd vs Cce, Jaipur-I on 5 November, 2012
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL, WEST BLOCK NO.II, R.K. PURAM, NEW DELHI-110066 COURT NO. II Service Tax appeal No. 863 of 2008-Cu[DB] [Arising out of Order-in-Appeal No. 104(DK)ST/JPR-I/2008 dated 23.9.2008 passed by the Commissioner of Central Excise (Appeals-I), Jaipur] Date of Hearing/decision: 5th November, 2012 N/s. Indag Rubber Ltd., Appellant Vs. CCE, Jaipur-I Respondent
Present for the Assessee : Shri S.C. Kamra, Advocate Present for the Respondent : Shri N. Pathak, D.R. Coram: Honble Shri D.N. Panda, Judicial Member Honble Shri Mathew John, Technical Member FINAL ORDER NO. ________________ Per D.N. Panda:
Shri Kamra, learned Counsel says that the issue framed by learned Adjudicating Authority is whether the service tax was leviable on the service of re-treading of old tyres provided by the assessee under the category of Business Auxiliary Service. It was also submitted that activity carried out not amounts to manufacture as held by the Apex Court in the case of P.C. Cheriyan vs. MST. Barfi Devi, reported in 1979 (4) ELT (J 593) (S.C.). The appellant is not liable to service tax. He particularly emphasised on following relevant portion of Para 10 of the judgement which is as under:-
The retreading of old tyres does not bring into being a commercially distinct or different entity. The old tyre retains its original character, or identity as a tyre. Retreading does not completely transform it into another commercial article, although it improves its performance and serviceability as a tyre. Retreading of old tyres is different entity having a different identity, so from retreading no new or distinct article emerges. The old tyre retains its basic structure and identity.
2. Revenue supports adjudication order.
3. Heard both sides and perused the record.
4.We went through the basis of issuance of show cause notice. At page 42 of appeal folder there is allegation that activity of retreading of old tyre carried out by appellant was Business Auxiliary service in terms of Section 65(19)(v) of Finance Act, 1944 since manufacturing under Section 2(f) of Central Excise Act, 1944 was carried out. No doubt, law before amendment to Section 65(19)(v) was as under:-
Production of goods on behalf of client Show cause notice does not say who is principal and who is client whereas the appellant has been brought as service provider when the chain of link to show who were identifiable client of principal for whom the principal was obliged to provide service to the appellant service provider is absent. In absence of established link of above nature it is difficult to approve adjudication. Therefore, without going into the argument of manufacturing activity carried out or not our decision is confined to interpretation of law as that was existing in the aforesaid manner during material period. Accordingly, appeal is allowed.
(Dictated & pronounced in the Open Court) (D.N. PANDA) JUDICIAL MEMBER (MATHEW JOHN) TECHNICAL MEMBER RK 3 ST/863/2008-CU[DB]