Composite CHA receipts cannot be split retrospectively for Port Services levy where the circular-based regime applied.

A composite turnkey CHA arrangement covered by the operative CBEC circular for the relevant period could not be split into separate components for an additional levy under Port Services. The Tribunal applied the existing circular-based regime to consolidated billing, treated the disputed receipts as composite consideration, and accepted that the later expansion of Port Services operated only prospectively. On that basis, the authorities could not retrospectively vivisect the same receipts and tax part of them under a different service head. The demand was therefore unsustainable and was set aside in favour of the assessee.

---

---

Issues: Whether the service tax demand could be sustained by splitting the consolidated charges collected for Custom House Agent and allied services and classifying part of the activity as Port Services, despite the existing CBEC circular governing turnkey CHA services.

Analysis: The appellant had been paying service tax on CHA services on the basis of the CBEC circular prescribing a simplified method for turnkey arrangements involving consolidated billing. The disputed invoices reflected a composite arrangement and the demand was sought to be raised by dissecting the total receipt into individual components and taxing one component separately as Port Services. The prior decision of the Tribunal on similar facts was treated as applicable, and the later expansion of the scope of Port Services was recognized as operating only prospectively from the notified change in law. On that basis, the Tribunal held that the existing circular regime governed the disputed period and that the receipts could not be split up for a separate levy under Port Services.

Conclusion: The demand was unsustainable and was set aside in favour of the assessee.

Final Conclusion: The appeal succeeded because the composite CHA-related receipts for the relevant period could not be vivisected for a separate levy under Port Services.

Ratio Decidendi: Where a composite turnkey CHA arrangement is governed by an operative CBEC circular for the relevant period, the tax authorities cannot retrospectively dissect consolidated receipts and impose a separate levy on part of the same consideration under Port Services.

---