BANGALORE COMMERCIAL Vs. CCE

JUDGEMENT

(1.) THE appellants M/s Bangalore Commercial Corporation (M/s BCC, for short) entered into a Memorandum of Understanding (MOU) with M/s Maini Materials Movement Pvt Ltd (M/s MMM, for short) on 11.3.98, which assigned the following responsibilities to M/s BCC with effect from 1.4.98 :

(2.) THE department, in a show cause notice dated 24.1.03, demanded Service lax on the aforesaid amount from M/s BCC alleging that the aforesaid services assigned to them by the MOU constituted three taxable services viz. Management Consultancy, Manpower Recruitment agency service and Market research agency Service. The show -cause notice has invoked the longer period of limitation in terms of Section 73(a) of the Finance Act, 1994. Demand of Service tax was contested by the party both on merits and on limitation. The original authority confirmed the demand of Service tax of Rs 4,83,350/ - against M/s BCC under Section 73(2) of the Act and imposed on them penalties under Sections 75A, 76 and 77 of the Act. The first appellate authority upheld the decision of the lower authority in so far as Manpower Recruitment Agency and Market Research Agency were concerned. As regards Management Consultancy, the appellate authority found that the MOU did not indicate that M/s BCC rendered any such service to M/s MMM. The lower appellate authority remanded the case to the original authority for re -quantification of the demand of tax, after setting aside the penalties. The party is still aggrieved by the order of the lower appellate authority. It is submitted by the learned Counsel for the appellants that all the services covered the MOU are "business auxiliary services" as defined under The Finance Act, 1994 as amended by the Finance Act, 2003.

(3.) I have examined the records and heard both sides. It is submitted by the learned Counsel for the appellants that all the services covered by the MOU are business auxiliary services as defined under Finance Act, 1994 as amended by Finance Act, 2003. He has furnished the definition of "business auxiliary service" which reads as under :