CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL HYDERABAD REGIONAL BENCH - COURT NO. – I Service Tax Appeal No. 30525 of 2018 (Arising out of Order-in-Appeal No.GUN-EXCUS-000-APP-172-17-18 dated 28.03.2018 passed by Commissioner of Central Tax & Customs (Appeals), Guntur)

M/s Bharathi Cement Corporation .. APPELLANT Pvt Ltd., Nallalingayapalli, Kamalapuram, YSR District, Andhra Pradesh – 516 309.

VERSUS Commissioner of Central Tax .. RESPONDENT Guntur - GST C.R. Buildings, Kannavarithota, Guntur, Andhra Pradesh – 522 004.

APPEARANCE:

Shri Ch. Sumanth, Advocate for the Appellant.

Shri M. Anukathir Surya, Authorized Representative for the Respondent.

CORAM: HON’BLE Mr. A.K. JYOTISHI, MEMBER (TECHNICAL)

HON’BLE Mr. ANGAD PRASAD, MEMBER (JUDICIAL)

FINAL ORDER No. A/30138/2026 Date of Hearing: 10.11.2025 Date of Decision: 09.03.2026 [ORDER PER: ANGAD PRASAD]

M/s Bharathi Cements Corporation Pvt Ltd., (hereinafter referred to as the appellant) has filed the present appeal against Order-in-Appeal No. GUN- EXCUS-000-APP-172-17-18 dated 28.03.2018 passed by the Commissioner (Appeals), whereby, Order-in-Original No.VIZ-EXCUS-003-ADC-53-16-17 dated 28.12.2016 has been upheld.

2. The fact, in brief, is that the appellant entered into an agreement dated 08.12.2012 with M/s VICAT S.A., France, for receiving advice and assistance in relation to business strategies, data collection, analysis, research, training, development, management and certain other allied areas. The appellant discharges applicable Service Tax under Reverse Charge Mechanism (RCM) under the category of ‘Management Consultancy Service’ in respect of the aforesaid services and avails Cenvat Credit thereof. Apart from the Management Consultancy Services, Department noted that certain employees of M/s VICAT S.A. have been deputed to India, for work under the control, direction and supervision of the appellant. The appellant has entered into individual employment agreements with such expats. A part of salary component is paid by the appellant into the bank account of the expats and balance salary, including the statutory contributions payable in France, is paid by the appellant to M/s VICAT S.A., who in turn remits the same to the bank accounts of the employees in France.

3. The appellant was subjected to Excise Audit during the course of which an objection was raised alleging non-payment of Service Tax on the salary re-imbursements made in respect of expatriate employees and paid to M/s VICAT S.A. The appellant, vide letter dated 04.12.2013, clarified that the services rendered by the expats were in their personal capacity and not on behalf of the foreign company and that M/s VICAT S.A. had no role in the working, supervision or terms and conditions of employment entered between the appellant and the expatriate employee. Notwithstanding the same, a Show Cause Notice dated 12.04.2016 was issued proposing demand of Service Tax on the salary reimbursements of the expats paid to M/s VICAT S.A. for the period December, 2010 to June, 2013. The appellant filed its reply to Show Cause Notice and attended the personal hearing, after due process the Learned Adjudicating Authority passed the following order:

ORDER

1) I hold that out of total demand of Rs. 66,93,771/- made in the SCN, the assessee is liable to pay Service Tax (including Cesses) of Rs. 53,55,642/- as receiver of Service in respect of taxable Services received by them during the period from December 2010 to June 2013 and I order for recovery of Rs. 53,55,642/- (Rupees Fifty Three Lakhs Fifty Five Thousand Six Hundred and Forty Two Only) from M/s Bharathi Cement Corporation Pvt Ltd., under Section 73(2) read with proviso to section 73(1) of the Finance Act 1994 along with interest at applicable rates under Section 75 of the Finance Act, 1994.

2) I order for appropriation of Rs. 18,57,880/- paid by the assessee towards the liability mentioned at (1) above.

3) I order for appropriation of Rs. 3,59,340/- paid by the assessee towards inte