Mining Service classification failed where only sizing and transport of already mined limestone were performed, and limitation also barred demand.

Sizing, breaking, loading and transporting already mined limestone under a work order did not amount to Mining Service because the provider undertook no mining activity and the principal work was transportation, making the service tax demand unsustainable on merits. The extended limitation period also could not be invoked because the activity was within departmental knowledge, the recipient was paying service tax under reverse charge, and audits had been conducted without objection, so suppression of facts was not established. The demand was therefore held to fail both on classification and limitation, with consequential relief granted.

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Issues: (i) Whether raising, sizing, breaking, loading and transportation of manually sized limestone supplied under the work order constituted Mining Service; (ii) Whether the demand was barred by limitation for want of suppression of facts.

Issue (i): Whether raising, sizing, breaking, loading and transportation of manually sized limestone supplied under the work order constituted Mining Service.

Analysis: The work order showed that the appellant was engaged only in sizing, breaking, loading and transportation of already mined limestone from the mining site to the recipient's plant. Mining activity was not assigned to the appellant and the major component of the work was transportation. The transportation element was also stated to have been taxed by the recipient under reverse charge mechanism.

Conclusion: The activity did not fall within Mining Service and the demand on merits was unsustainable.

Issue (ii): Whether the demand was barred by limitation for want of suppression of facts.

Analysis: The same activity was within the knowledge of the department, the recipient was discharging service tax, and the recipient was subjected to audit from time to time. In these circumstances, suppression of facts could not be attributed to the appellant.

Conclusion: The demand was also hit by limitation.

Final Conclusion: The demand was unsustainable both on merits and on limitation, and the impugned order was set aside, granting consequential relief.

Ratio Decidendi: Sizing and transportation of already mined limestone, where no mining activity is undertaken by the service provider, cannot be classified as Mining Service, and absence of concealment where the activity is within departmental knowledge defeats invocation of the extended period.

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