2014 (12) TMI 378

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....ining Lease No.2552 dt. 03/07/2007. The firm entered into an agreement with the partner of the firm vide the Agreement dt. 26/03/2010 whereby the entire mining operations was entrusted to the appellant, who was one of the partners of the firm. The agreement also provided to share the raised ore in the share of their profit sharing ratios among the partners of the firm as consideration for undertaking the entire mining operations. 2. The activity undertaking by the appellant in terms of the above agreement dt. 26/03/2010 has been held to be taxable service falling under the category of 'mining of mineral, oil or gas service'. As a result of such a view, demand for service tax of Rs. 12,38,99,236/- has been confirmed with interest and pena....

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....sive of each other. He relies on the decision in the case of Subhash Khandelwal Construction (P) Ltd. Vs. CCE, Jaipur -I [2013(32) STR 455 (Tri. Del.)] and submits that in this case a view was taken that the activity of packing, labeling, loading and unloading of finished goods at factory premises of service recipient cannot be considered as cargo handling service since the activity amounts to manufacture as per the provisions of Central Excise Tariff Act, 1985. This view was taken since Section 65(19) of Finance Act, 1994 excludes manufacture of excisable goods from purview of business auxiliary services and immuned from service tax. We do not think that this decision would be relevant to the present case before us. We have to take note of....

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.... activity of mining of iron ore can be liable to service tax as well as excise duty. When it comes to Central Excise duty, excise duty will be leviable on the total transaction value and on the entire quantity of iron ore extracted. When it comes to service tax, the amount paid as consideration for the iron ore extraction would be the amount leviable to service tax. The nature of taxes is entirely different; taxable events are different. 7. Further it was also argued that there is no service provider and service receiver relationship in this case. We are unable to agree with this view. No doubt there are decisions saying that a partnership firm is an association of persons and therefore may not have an individual identity. However, when ....