Page 82 - GSTL_23rd April 2020_Vol 35_Part 4

408 GST LAW TIMES [ Vol. 35
fact, for providing manpower. The principal - CPP were supervising the workers
supplied by the appellant for the various jobs like pith feeding, wood shifting,
cleaning, etc. As per the agreement, the appellant was required to maintain
steady supply of workers for the jobs. As per the agreement, the appellant was
entitled to get payment only to the extent of job done. But in reality, over and
above, the contracted rate, CPP was also paying towards ESI, bonus & P.F. Fur-
ther, as per the agreements between the parties, the liability to comply with the
Labour Laws was on the appellant, but in actual practice, the same was complied
by the principal - CPP, ESI and P.F. contribution were required to be deposited
by the appellant for its employees, but the same were deposited by the principal
- CPP, which also supports the allegation that the appellant supplied manpower.
The agreements entered into between the parties were not genuine and appeared
to be colourable device to avoid tax. Further, Mr. Jitendra Kumar Sahni created a
new concern and got himself registered with the Department under the category
of “Service of Manpower Supply Agency” for the very same jobs as were being
done in the past. From the attendance register (RUD-15), copy of which was re-
covered from CPP, it appeared that the appellant was maintaining a register
wherein the name of the workers and the respective work place/section was
shown.
4. The show cause notice was adjudicated on contest and vide im-
pugned Order-in-Original dated 27-11-2013, the proposed demand of
Rs. 72,50,883/- was confirmed along with interest and further penalty was im-
posed under Sections 76, 77 and equal penalty under Section 78 of the Act. Being
aggrieved, the appellant is before this Tribunal.
5. Heard the parties and perused the records.
6. The issues in this appeal arising are as follows :-
(i) Whether the appellant is liable to pay service tax under the classifi-
cation “supply of manpower” for the period prior to 31-3-2010? and
(ii) Whether the show cause notice is bad for invocation of extended
period of limitation?
7. From the perusal of the copy of the agreement and copy of the bills
on record, I find that the appellant has entered into an agreement for execution of
various works for the principal - CPP. The payment for such work is based on
the volume of the work executed and not according to the number of workmen
deployed by the appellant.
8. We further find that such facts have been recorded in the impugned
order-in-original wherein the Ld. Commissioner has taken notice of the agree-
ment and the rates for various works e.g. lifting of wood from yard and supply
to R.G.P. Chipper, is at the rate of Rs. 20/- per M.T. Similarly, for other work also
like debarking of stacks of green wood, splitting of pulp wood, stacking of UPFC
logs of all sizes and stacking of bamboo of all sizes, etc., have been provided
P.M.T. basis. These facts are also confirmed from the bills raised by the appellant
for the relevant period, which are on the basis of quantum of work executed and
not based on the number of workmen deployed or allegedly supplied. The Ad-
judicating Authority has misconstrued the contract between the parties and has
heavily relied on the payment of ESI and PF by the principal - CPP, in respect of
workmen deployed by the appellant. Under the relevant Labour Laws being the
Employees Provident Fund Act, 1952 read with the Scheme and the Employees
State Insurance Act, 1948, the liability for workers employed in a factory towards
payment of P.F. and ESI contribution is on the principal employer ultimately.
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