Page 86 - GSTL_30th April 2020_Vol 35_Part 5

572 GST LAW TIMES [ Vol. 35
appellant will be covered under definition of the BAS, under the Act. Even by
assuming that the grant of 51% of equity is considered as consideration, for rend-
ing of service, the same was granted in year, 2008-09, while the notice has been
issued on 18-3-2015, this is even beyond the limit of five years, therefore, the
show cause notice could not have been issued on this count. The demand is,
therefore, not sustainable. On merit, also we find that similar issue regarding the
‘royalty’ to be treated as value for the purpose of renting of immovable property
services in case of Mormugao Port Trust v. Commissioner - 2017 (48) S.T.R. 69 (Tri. -
Mum.) wherein it is held that amount received as royalty was not consideration
for rendition of any services including renting/leasing land and waterfront but
in fact was the assessee’s share of revenue arising out of joint venture between
assessee and SWPL and thus, was not liable to Service Tax. The appeal against
this order, the Hon’ble Supreme Court in case of Commissioner v. Mormugao Port
Trust - 2018 (19) G.S.T.L. J118 (S.C.) dismissed the appeal filed by the Department
on the ground of delay as well as on merits.
23. Regarding the expenses recovered by the appellant on actual basis
from BLMCL, the JV company, towards deputation of their employee and related
expenses, cannot be categorised under the BAS. Even otherwise the deputation of
employee in the JV company cannot be treated as BAS. Relying on the decision of
this Tribunal in the case of Punj Lloyd Ltd. v. CST, Delhi - 2019 (22) G.S.T.L. 85
(Tri. - Del.), the relevant paragraph is as under :
“9. On the second issue, we note that the appellants have deputed
some of their employees to their subsidiary group company. For such de-
puted employees, they have got consideration on actual basis reimbursed
by the said subsidiary unit. The appellants have recovered cost for such
deputation on actual basis without any mark up. We note that the appellant
is not engaged in manpower recruitment or supply and are not to be con-
sidered as manpower supply agency. Even otherwise, we note that the de-
cision cited and relied upon by the appellant on this issue herein above as
well as the decision of the Tribunal in Airbus Group India Pvt. Ltd. - 2016 (45)
S.T.R. 120 (Tri. - Del.), settles the issue in favour of appellant. We find de-
puting employees to group company cannot be considered as supply of
manpower. The appellants categorically asserted that they continued to
control the deputed employees and have only got reimbursement of actual
cost for such deputation. We find following the ratio of decided cases men-
tioned above, the service tax liability on appellant on this issue cannot be
sustained.”
Similar view has been taken by this Tribunal in the case of Franco Indian Pharma-
ceutical Pvt. Limited v. CST, Mumbai - 2016 (42) S.T.R. 1057 (Tri. - Mum.). The rele-
vant paragraphs are as under :
“7. We can reach the same conclusion by viewing this matter from a dif-
ferent perspective. By legislative design, services rendered in the course of
employment have been kept outside the purview of service tax levy. This is
true not only for the period under consideration but even at present under
the new Negative List Regime of taxation post-2002. Whether such service
are rendered by an employee to one employer or to many, as in the case of
joint employment, cannot make any difference to the tax treatment of the
emoluments earned by the employee. We find support for this conclusion
from a Draft Circular of the Board dated 27-7-2012 which deals with the
cases of “joint employment”. Though a final Circular does not seem to have

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