Refund under Notification 41/2007-ST allowed where new classification objection was not raised in the show cause notice.

Refund of Service Tax on terminal handling charges and bill of lading charges was held admissible under Notification No. 41/2007-ST. CESTAT noted that the show cause notice challenged only the alleged lack of authorisation of the port service provider, so the Revenue could not raise a new classification objection for the first time in appeal. The Tribunal also followed its earlier view that refund cannot be denied merely because port services were rendered without authorisation by the port. The Revenue's objection was rejected and the refund claim was allowed.

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Issues: Whether refund of Service Tax paid on terminal handling charges and bill of lading charges was admissible under Notification No. 41/2007-ST, and whether the Revenue could raise a new objection regarding classification of the service in the absence of such a ground in the show cause notice.

Analysis: The objection that the service provider was registered under Business Auxiliary Service was not part of the show cause notice, which proceeded only on the alleged absence of authorization of the port service provider. A ground not put to notice cannot be introduced for the first time at the appellate stage. The Tribunal also relied on its earlier view that refund cannot be denied merely because the port services were rendered without authorization by the port.

Conclusion: The refund claim was held admissible and the Revenue's objection was rejected.

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