COMMISSIONER OF CENTRAL EXCISE Vs. BISHAMBER LAL ARORA

JUDGEMENT

(1.) SHOW cause notice dated 13 -9 -2007 alleged that during the period February 2005 to March 2006, the respondent provided three taxable services -

(2.) IN respect of manpower recruitment or supply agency service already provided, assessee contended that it employed labourers to fix jute bags to the mouth of the packing machine, to oversee the flow of bags on the conveyor system and to correct the course if any error occurs and guide the boom for stacking. The assessee further contended that labourers were employed for removal of stones from coal, moving coal through conveyor systems coal and these activities do not fall within the scope of the manpower recruitment or supply agency service.

(3.) THE Additional Commissioner, Central Excise, Ludhiana by the adjudication order dated 18 -3 -2008 rejected the claims of the assessee and confirmed Service Tax demand for Rs. 13,53,423/ - apart from interest and penalty as specified. Aggrieved, the assessee preferred an appeal which was allowed by the impugned order dated 3 -9 -2008 passed by the Commissioner (Appeals), Chandigarh. Relying on several decisions including of the High Court of Rajasthan in S.B. Construction Co. v. Union of India - : 2006 (4) S.T.R. 545 (Raj.), the appellate Commissioner concluded that as the assessee was only engaged in packing and unpacking of fertilizer bags at Ludhiana by automatic/mechanized process by employing manpower for the purpose and fertilizer bags were handled/moved from the bagging plant area to the railway wagons, employing mechanized systems, the activity falls outside the purview of cargo handling service.