2024 (4) TMI 677 - AT - Service Tax

Tribunal Upholds Order: No Service Tax on Coal Transport from Mines to Railway Sidings; Dismisses Department's Appeal.

COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX, JABALPUR Versus KSK STC GKT JOINT VENTURE FIRM

The Tribunal dismissed the department's appeal, upholding the original order that set aside the proposed service tax demand of Rs. 79,54,892/- on the ... Classification of services - mining services or not - hiring pay loader and tipper/dumper for loading - HELD THAT:- The findings of Bombay High Court in the case of INDIAN NATIONAL SHIPOWNERS' ASSOCIATION VERSUS UNION OF INDIA [2009 (3) TMI 29 - BOMBAY HIGH COURT] have been quoted by the Adjudicating Authority and it has been held that the transportation of coal as performed by the Assessee herein on tippers/trucks upto siding has no direct/indirect nor any proximate relation with the mining of coal (mining activity). The issue is no more res-integra, the authorities have rightly followed the judicial discipline while applying the ratio of the Hon’ble Supreme Court’s decision in COMMISSIONER OF CENTRAL EXCISE AND SERVICE TAX, RAIPUR VERSUS SINGH TRANSPORTERS [2017 (7) TMI 494 - SUPREME COURT]. Hence, there are no infirmity in the order under challenge. The order under challenge is hereby upheld - the appeal filed by the department is dismissed. Issues involved: The issue involves the classification of services provided by the appellant under the category of 'Mining Services' for the purpose of service tax liability.Summary:Issue 1: Classification of services under 'Mining Services' categoryThe department filed an appeal to challenge the order rejecting the proposal to recover service tax amounting to Rs. 79,54,892/- along with interest and penalties, alleging that the activity of hiring pay loader and tipper/dumper for loading falls under 'Mining Services'. The appellant argued that as per work orders, they provide handling and transportation of coal from bunkers to sidings, which should be considered part of mining services and hence taxable. The appellant relied on the decision in the case of Commissioner of Central Excise vs. M/s Thriveni Earth Movers Private Limited and a Circular issued by CBEC to support their argument.Issue 2: Application of judicial precedentsThe original adjudicating authority relied on the decisions of the Tribunal and the Supreme Court to conclude that the transportation of coal from mines to railway siding does not have a direct or indirect relation with mining activity. The authority cited the decision of the Hon'ble Supreme Court in the case of Commissioner of Central Excise & Service Tax vs. Singh Transporters, and held that the demand proposed in the show cause notice was set aside based on established judicial precedents. The Tribunal upheld the order under challenge, stating that the issue has been settled by the Supreme Court's decision in Singh Transporters case.Conclusion:The Tribunal found no infirmity in the order under challenge, as the authorities correctly applied the judicial discipline by following the ratio of the Supreme Court's decision in Singh Transporters case. The Tribunal upheld the order, dismissing the appeal filed by the department. The controversy regarding the transportation of mine goods from mines to Railway siding has been settled by the Supreme Court's decision, and the order under challenge was upheld accordingly.