TaxTMI 
TaxTMI 
2019 (5) TMI 160
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.... taxable under the category of port services. • Management and allied services: The appellants provided the services of terminal maintenance, jetty cleaning, house-keeping, moving/unmoving of barges/ vessels at berth, cleaning of barges, cleaning of vessel deck, closing/ unclosing of hatches of the mini bulk carrier, technical services for the cranes of barges, loading of coils/ sheet packs in barges etc. The services are alleged to be taxable under the category of port services. • Salary paid to Foreman/ Khalasi: The appellants raised bills for reimbursement of salary paid to Foreman/ Khalasi and collected the gross amount from recipient of service. It is alleged that supply of Foreman/ Khalasi is service taxable under the category of Manpower Recruitment & Supply Agency and service tax is payable on the same under this category. 2.1 Freight on Barges: Ld. Counsel argued that the amounts received as freight on barges is not taxable. He pointed out that Magdalla Port, where there services was provided, is a shallow port and therefore, the mother vessel has to anchor at a point away from the jetty. Consequently, the goods are to be unloaded from the moth....
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....of these services. Ld. Counsel further relied on the agreement between the appellant and M/s Essar Shipping Ltd. which reads as follows: From the above agreement, Ld. Counsel argued that the service provided by them was only man power supply service and therefore, the said service cannot be classified as port service as held in the decision of Tribunal in the case of Velji P & Sons (Agencies) P. Ltd. (supra) since there was no authorization from the port. The supply of man power agency became taxable only w.e.f. 16.06.2005. Part of the period pertains to period prior to levy of tax, on manpower supply service. 2.4 Management & Allied Services: The next issue relates to the service of stevedoring provided by the appellant. Ld. Counsel argued that the said service is not taxable since they were not authorized by the port to provide the said service and relied on the decision of Tribunal in the case Velji P & Sons (Agencies) P. Ltd. (supra). 2.5 Salary paid to Foreman/ Khalasi: Ld. Counsel argued that they were also engaged in supply of foreman/ khalasi to M/s Essar Steel Ltd. The said foreman/ khalasi were their employees and were supplied to M/s Essar Steel Ltd. on temporar....
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....ne operator employed by the appellants to operate the crane used for handling of cargo from mother ship to barges. The bills have been raised on M/s Essar Shipping Ltd. The services are alleged to be taxable under the category of port services. c) Management and allied services: The appellants provided the services of terminal maintenance, jetty cleaning, house-keeping, moving/unmoving of barges/ vessels at berth, cleaning of barges, cleaning of vessel deck, closing/ unclosing of hatches of the mini bulk carrier, technical services for the cranes of barges, loading of coils/ sheet packs in barges etc. The services are alleged to be taxable under the category of port services. d) Salary paid to Foreman/ Khalasi: The appellants raised bills for reimbursement of salary paid to Foreman/ Khalasi and collected the gross amount from recipient of service. It is alleged that supply of Foreman/ Khalasi is service taxable under the category of Manpower Recruitment & Supply Agency and service tax is payable on the same under this category. e) 4.1 In the case of first three services the primary defense of the appellant is that the said service cannot be considered ....
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....t two different legal entities. In view of clear supply of manpower by appellant they are liable to tax. Moreover, it is seen that there is no ambiguity in law and in these circumstances failure to pay can be clearly attributed to intention to evade. Extended period has been rightly invoked. Demand on this count is confirmed. 4.3 Appeal is partly allowed in above terms. (Pronounced in the open court on 30.04.2019) ============= Document 1 "You shall be paid a monthly lump-sum amount of Rs.9,73,000/- (Rupees nine lakhs seventy three thousand only) for your services. The lump-sum amount is all inclusive including PF (Employee and Employer share) Housekeeping Allowance, Victualling, Repatriation Leave salary, monsoon allowance, medical expenses on duty. Please note that lump sum amount mentioned above is calculated based on 20 No. Officer and Staff (standard 700 man days / month) and 15 No crew (standard 456 man days/month). Suitable adjustments will be made n the monthly invoice itself for any deviation in man days as compared to base standard man days as mentioned above. For this value adjustments, consolidated salary, house keeping allowance....
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....se has observed that the authorization from the Port must be in respect of the services which the port itself is required to provide as such authorization would make an assessee step into shoes of the Port. Having already observed that such services were not required by the port, any authorization by the Port cannot convert the services into port services. In any case, we find that there is no authorization by the Port to the appellant to conduct the services on his behalf. Licenses issued by the Port authorities cannot be considered as authorization. Such licenses are issued by the Port authorities to all the persons working in the Port to ensure the safety and security of the Port Area and does not confer any power or authority of the Port on the person so issued with the licence. If the licences issued by the Port are taken as authorization, then such licences issued to Stevedores, ship chandlers, labourers, repairers of the vessels etc. would also become authorized persons by the Port to render services as Port services. Document 4 7. We further note that Section 42 of the Major Port Trusts Act provides for authorization by the Board for various ....