TELEPHONE CABLES LTD. Vs. COMMISSIONER OF C. EX.

JUDGEMENT

(1.) WE have heard the learned Counsel at length. On going through the terms of the contract, it appears that the appellant was rendering services for the development of the export activity of the appellant. The learned Counsel contended that the price negotiations with mills, quality monitoring, monitoring of delivery schedules from mills, liaison with transporters used by mills for despatch of export material and settlement of quality or shipment disputes with mills on behalf of customers cannot be described as management consultancy and that the nature of services rendered by the appellant would more accurately fall under the category of Business Auxiliary Service introduced w.e.f. 10 -9 -2004.

(2.) WE have gone through the entry relating to Business Auxiliary Services and prima facie it is not possible to say that the services rendered by the appellant to its client fall within Business Auxiliary Service. The emphasis of the Business Auxiliary Service is in relation to the promotion or marketing or sale of goods produced or provided by or belonging to the client i.e the person to whom the services were to be provided. The applicant was not dealing with any goods produced or provided by or belonging to its client. The learned Counsel tried to contend that the nature of the services rendered would be covered by clauses iv, vi and vii of the definition of Business Auxiliary Service. These clauses relate to procurement of goods or services which are inputs for the client, provision of service on behalf of the client and a service incidental auxiliary to any activity specified in Clauses (i) to (vi). The nature of the services rendered by the applicants do not disclose that the applicant was procuring the goods or services for its clients for being used as inputs, nor were any services rendered on behalf of the said clients. Therefore, prima facie, there is no warrant for waiving the total pre -deposit. Though, in view of the decision of the Supreme Court in Metal Box India Ltd. v. Commissioner of Central Excise, Mumbai , payment of pre -deposit covered under Section 35F of the Central Excise Act, 1944 does not fall under any of the enumerated categories under Section 22 of the Sick Industrial Companies (Special Provision) Act, 1985, the fact that the applicant is sick, as stated by the learned Counsel, can be taken into consideration for fixing the amount of pre -deposit to be made. We, therefore, direct that there shall be interim stay of the impugned order on the applicant's depositing fifty per cent of the service tax payable under the impugned order within eight weeks from today, failing which the interim stay shall stand vacated and the appeal will stand dismissed. On the amount being so deposited, there shall be waiver of pre -deposit of the remaining amount. This application stands disposed of accordingly. Post the matter for reporting compliance on 23 -1 -2006.