TaxTMI 
TaxTMI 
2012 (3) TMI 271
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....mand of Rs. 11,54,31,297/- along with interest and penalty equal to the same amount imposed under section 78 of the Finance Act, 1994. Aggrieved by the order the Appellants have filed this appeal before the Tribunal. 3. Definition of Cargo Handling Service under section 65(23) of the Finance Act 1994, during the relevant period was as under: "(23) "cargo handling service" means loading, unloading, packing or unpacking of cargo and includes cargo handling service provided for freight in special containers or non-containerized freight, services provided by a container freight terminal or other freight terminal for all modes of transport and cargo handling service incidental to freight, but does not include handling of export cargo or passenger baggage or mere transportation of goods" 4. The appellants contest that the activity undertaken by them would not be covered by the above definition. Their contract is for integrated activity of mining which is brought under service tax levy under "mining service" introduced with effect from 01-06-2007. The composite service rendered by them should be classified in terms of section 65A of the Act. Integrated mining activity cannot be v....
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....y especially in a situation involving interpretation of law. 8. The Ld SDR on the other hand relies on Circular 232/2/2006-CX-4 dated 12-11-07 issued by CBEC when mining service was brought under tax net by Finance Act, 2007, Relevant portion of the circular reads as under: "Subject: Applicability of Service tax on activities undertaken at mines prior to enactment of the Finance Bill, 2007 - Regarding It may be recalled that vide appropriate entry in the Finance Act, 2007, 'service provided by any person to any other person in relation to mining of minerals, oil or gas' has been comprehensively brought under the ambit of service tax with effect from 1-6-2007. However, for the prior period, certain disputes relating to chargeability of service tax on some of the services provided to mining sector were reported. In this regard, a draft circular dated 9-10-06 was put up on the official web-site, soliciting response from the stakeholders. The responses received have since been examined. 2. The mining sector (such as the coal mines, mining of ores, etc.) mainly receive the following types of services, mostly on contract basis :- (i) Excavation/drilling and removal....
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....y system, merry-go-round systems etc., and the same is not transported by road, no service tax would be chargeable. Service tax is, however, chargeable under cargo handling service, even if the loading, unloading and similar activities are done using mechanical systems. 6. The above are the general guidelines for settlement of pending disputes. These should be applied to individual cases keeping in view the facts and circumstances of each case." 9. The Ld SDR points out clause 1.12 of the contract with BALCO and clause 1.29 of the contract with HINDALCO to argue that the work done by the appellants includes loading and unloading of cargo at places outside the mine also. The said clauses read as under: "1.12 Transportation by road of Bauxite from the Kesra/Kudardihi/any other area of Mines of company located at Mainpat, Distt. Sarguja (Chattisgarh), including loading of Bauxite into trucks from Stock yard at Mainpat. Weighment of truck (both tare and gross wherever facility of weighment is available), transportation up to Company Bauxite yard and Alumina Plant. Weighment of truck inside Plant (both gross and tare), unloading the Bauxite. Any other work not specifically indi....
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....o agree with the contention of the Appellants that a bundle of services cannot be vivisected. However this issue is to be examined with reference to facts of each case. 15. Nothing in the two contracts indicates that these contracts had any significant component of cargo handling other than, transportation. In the activities carried out by the appellants there appears to be a small component of loading and unloading of cargo. The contract with BALCO has an integrated rate of Rs. 485 per ton for mining, transportation, loading and unloading. In the case of HINDALCO there are two components in the compensation rate, one for mining and another for transportation. No separate activity of cargo handling is mentioned or rate specified. Obviously the component for transportation will depend on the distance of transportation. But the main activities are that of mining and transportation. By now it is well settled that handling or transportation of goods within a factory or mining area does not amount to cargo handling because at that stage the goods are not cargo within the common meaning of the word. As per records of the case, on the entire component of transportation the receiver of ....