Nature of services rendered

[sanjay nayak]

we are a patnership firm engaged with stevdoring, customs clearing etc inside port permises. we are also handling export cargo as intraport, loading into vessels. What will be the nature of service. i.e. - port service or cargo handling service. further we were considering the same as cargo handling service and was not charging service tax for the export cargo handled by us. now we got a show cause notice from stax dept that this is under port service and no exemption is there. now for the period apr 09 to aug 09 for which we had not charged service tax to our parties, we are charging under port service as a supplymentary bill for the service tax part only. can our parties avail cenvat credit on these supplymentary invoices.

AI Summary

Cenvat credit on supplementary service invoices may be disallowed, exposing recipients to input credit risk.
Services constitute port services only when provided by a person authorised by the port authority; mere cargo handling within port premises does not suffice. Cenvat credit is not available on supplementary invoices for services-supplementary invoices apply to excisable goods-so suppliers paying under protest should seek reimbursement under contract but beware that passing the charge to clients while protesting may compromise positions and expose clients to denial of credit if demands relate to periods affected by limitation rules.