Auction surplus from abandoned cargo is not taxable as storage and warehousing service when customs dues are discharged.

Surplus retained by a custodian or container freight station from auction of abandoned or uncleared cargo, after discharge of customs dues and related expenses, does not constitute taxable consideration for storage and warehousing services. The Tribunal followed its earlier coordinate Bench rulings and the Board circular clarifying that service tax is not leviable on auction proceeds of abandoned cargo where applicable duties and taxes have been paid. The Revenue's attempt to distinguish the case on the basis of warehouse charges was found inapplicable on the facts, and the demand was set aside in favour of the assessee.

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Issues: Whether service tax is payable on the surplus amount retained by a custodian or container freight station from auction of abandoned or uncleared cargo, when the amount is reflected as income and the goods are auctioned after compliance with the customs procedure.

Analysis: The Tribunal followed its earlier decisions holding that the surplus arising from auction of abandoned cargo is not taxable as storage and warehousing service. It relied on the Board's circular clarifying that service tax is not leviable on auction of abandoned cargo where the applicable duties and taxes are discharged. The Tribunal also treated the issue as settled by prior coordinate Bench rulings and found the attempted distinction based on warehouse charges to be inapplicable on the facts.

Conclusion: The amount retained from auction of abandoned cargo is not liable to service tax under storage and warehousing services. The Revenue's challenge fails and the assessee's position is upheld.

Final Conclusion: The demand was set aside and the Revenue's appeal was rejected, leaving the impugned order undisturbed in favour of the assessee.

Ratio Decidendi: Surplus retained by a custodian from the auction of abandoned or uncleared cargo, after discharge of customs dues and expenses, does not constitute consideration taxable as storage and warehousing service.

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