TaxTMI 
TaxTMI 
2022 (3) TMI 804
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....rs lease agreement with the state of Karnataka for use of the port land for stacking Iron Ore/Manganese Ore and other bulk cargoes at Belekeri Port for export /import of the goods. The nature of Belekeri port is officially recognized as a Lighterage Port, where barges are used for carriage of cargo from the shore to the ship and vice versa. Records resumed from appellant revealed that they have charged the amount from their clients against the provision of barging/lighterage services at Belekeri Port and not shown the same in ST-3 returns during period 2006-07 and 2007-08. However they shown the said charges during the period 2008-09 they declared such charges as exempted income received while rendering port services. After October 2009 they have obtained the service tax registration under the category of 'Transport of Goods by way of Waterway Services', as provided under Section 65(105)(zzzzl) of the Finance Act, 1994. They have been paying service tax on such lighterage charges by classifying the service as 'Transport of Goods by Waterways Service', whereas during the period from April 2008 to Sept. 2009 they were declaring the same as exempted income collected while rendering Po....
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....from the finance Act ,2009, the appellant charged the service tax on the barging activities and deposited the tax. The department has accepted the classification and didn't raise any objection. Hence it is not open for the department to take different view for the period prior thereto. He also submits that introduction of the new entry having been enacted covering the activity of transportation of goods by inland water, without any change in the entry of port service, it has to be interpreted that earlier entry did not cover the taxable entry introduced subsequently. He placed reliance on the decision of Jet Airway India Ltd. Vs CCE reported in 2008(11)STR645(T). Reliance is placed upon following decision also:- a. Para -132 of Finance Minister's Budget Speech of 2009-2010 dtd. 06.07.2009 b. United Shippers Ltd. Vs CCE, 2015 (37)STR 1043(Tri. Mumbai) c. M/s Essar Logistics Ltd. Vs. CCE 2016(2)TMI 222-CESTAT d. CST Vs. Nova Enterprises 2015(38)STR1012 (Tri. Ahmd) e. Velji P. And Sons (Agencies) Pvt. Ltd. and ors. Vs CCE 2007(8)STR 236 f. HML Agencies (p) Ltd Vs CCE - 2018(12)GSTL 46 g. H.K. Dave Ltd Vs CCE 2008 (12)STR56....
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....ady been paid. Reliance is placed upon following judgments: (I) Ispat Industries Ltd. Vs. Commissioner of Customs, Mumbai - 2006(202)ELT 561 (SC) [Affirmed in 2010(255) ELT A122 (SC) (ii) South India Corporation (Agencies) Ltd. Vs. Collector of Customs and Ors. [ 1987(30)ELT 100 (Cal.) (iii) United Shippers Ltd. Vs. CCE , 2015(37)STR 1043 (Tri. Mumbai) [Affirmed in 2015 (39) STR J369 (S.C.) ] 6. He further submits that the contract has to be interpreted separately as per the tenor of the contract as the Appellant has charged separately for "Cargo Handling Service" and for the "Transportation activity" and therefore, the Service tax was leviable only on the amount charged towards cargo handling service. He placed reliance on the following decisions (i) Hira Industries Ltd. Vs. Commissioner of Central Excise - 2012 (28) STR 23. (ii) Mosaic India Pvt. Ltd. Vs CCE, 2005 (38) STR 577 (Tri. -Ahmd.) (iii) Essar Project (India) Ltd., Vs CCE & ST 2014(33)STR 696 (Tri. Ahmd) (iv) UOI Vs Mahindra & Mahindra Ltd., 1995 (76)ELT 481(S.C.) 7. He also submits that extended period of limitation is not invocable in the present fact....
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.... C.Ex & S.Tax , Guntur- 2014 (310) ELT (97) (Tri. Bang.) - Affirmed by Hon'ble Supreme Court in case of Commissioner Vs Coastal Energy Pvt. Ltd. - 2016 (340) ELT A 204 (S.C.) 8. He argued that issue is an interpretation issue and the bonafide interpretation of the Appellant was that they were not liable to pay Service tax, based on a strict reading of the provisions existing during the relevant point in time. It is settled principle in law that no penalty can be imposed where there is an interpretational issue / ambiguity in the relevant provisions. Reliance is placed upon the following decisions: (i) Tata Consultancy Services Vs Commissioner 2018 (18) GSTL 478 (ii) Hindalco Industries Ltd. Vs. CCE 2018 (10) TMI 392 - Del. (iii) Suntex Business Solutions Pvt. Ltd. Vs CCE [2017 (51) STR 446 (Tri. Bang.) (iv) Uni Ads Ltd Vs CCE 2016 (42) STR 547 (Tri. Bang.) 9. Shri. T G Rathod, Learned Additional Commissioner (Authorized Representative) appearing on behalf of revenue opposed the contention of the Ld. Counsel and reiterated the findings of impugned orders. He also placed reliance on the following decisions:- (i) 2019 (27) GSTL 363 (T....
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....r port, in any manner." From above definitions of 'Port Service' before the amendment of 1-7-2010 and after the said amendment of 1-7-2010, We find that prior to 1-7-2010 focus/emphasis was on any service rendered by a port or other port or any person authorised by said port or other port. But in the definition of 'Port Service' after the amendment of 1-7-2010, the focus/emphasis is on any service rendered within a port or other port. Thus prior to the amendment of 1-7-2010 each and every service rendered within a port or other port cannot be covered by the category of 'Port Service' unless it was specially rendered by such Port (a port or other port) or by a person 'authorised by such Port or other Port. 13. In this context, reference is made to CESTAT, Ahmedabad's decision in the case of Shreeji Shipping v. CCE, Rajkot : 2014 (36) S.T.R. 569 (Tri.-Ahmd.). In the said decision it was held that the services rendered by anyone within the port would be taxed under the head of 'port services' only w.e.f. 1-7-2010, when there was amendment to the 'port services'. In CESTAT, Bangalore's decision in case of Aspwinwall & Co. Ltd. 2011 (21) S.T.R. 257 (supra). CESTAT, Bangal....
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....t 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. 7. We further note that Section 42 of the Major Port Trusts Act provides for authorization by the Board for various services specified by that Port in the Official Gazette. For such authorization if effective, the same should have prior approval of the Central Government and the person so authorized cannot charge any excess payments than the amount specified in the tariff authority for Major Ports, by Notification in the Official Gazette. The licenses issued to the appellant are not governed by the statutory requirement of Section 42 inasmuch as the appellant is free to charge any amount from....
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....oregoing discussions and applying the ratio of law declared by the Tribunal in the case of Homa Engineering Works, we are of firm view that activities undertaken by the appellant does not fall under the category of Port Services." 16.2 Revenue, aggrieved by such an order, preferred Civil Appeal Nos. 2429-2430 of 2008 along with an application for condonation of delay before the Hon'ble Supreme Court. Their lordships on 24-3-2008 passed the following order. "Delay condoned. The Tribunal, relying upon its own decision in the case of M/s. Homa Engineering Works v. CCE, Mumbai, has allowed the present appeal filed by the assessee. Against the aforesaid case in M/s. Homa Engineering Works v. CCE, Mumbai, Revenue has not filed any appeal in this Court. In view of this, this appeal is dismissed. No costs". 17. It can be seen from the above reproduced ratio of the judgment of the Tribunal in the case of Velji P. & Sons (Agencies) P. Ltd. that the facts, of that case and the facts in these cases before us are identical wherein various services were rendered by the appellants herein within the port area. Since the ratio of the judgment of....
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....ospective and is effective after 1-7-2010 only. The services rendered within the 'Port area', which is subject matter of the present appeal and services rendered within 'airport premises' are comparable. Therefore, findings and the conclusion made by Hon'ble Delhi High Court in the said case are relevant and applicable mutatis mutandis to the present facts and subject matter of this appeal. 15. In view of above, in respect of the services rendered by the appellant during the relevant period, they cannot be made liable to pay service tax under the category of 'port services'. 16. Further under the "Port Service", service provided by a Port, other port or any person authorised by such port is taxable. The Appellant liable to pay tax under above entry only if they had been authorized by the Port to render services in relation to vessels or goods. In the present case department failed to produce any evidence by which it can be prooved that the Appellant were authorized by the port for providing services at port. There is no authorization by the Port to the appellant to render the said services. We have gone through the lease agreement dtd. 03.04.2006 made between Appellant and Di....
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...., 1963 (38 of 1963). The Major Port Trusts Act, 1963 (38 of 1963) Section 2 - Definitions - In this Act, unless the context otherwise requires, - (q) "port" means any major port to which this Act applies within such limits as may, from time to time, be defined by the Central Government for the purposes of this Act by notification in the Official Gazette, and, until a notification is so issued, within such limits as may have been defined by the Central Government under the provisions of the Indian Ports Act; (z) "vessel" includes anything made for the conveyance, mainly by water, of human beings or of goods and a caisson; Section 35 - Power of Board to execute works and provide appliances (1) A Board may execute such works within or without the limits of the port and provide such appliances as it may deem necessary or expedient. (2) Such works and appliances may include - (a) wharves, quays, docks, stages, jetties, piers and other works within the port or port approaches or on the foreshore of the port or port approaches, with all such convenient arches, drains, landing places, stairs, fences, roads, railways, b....
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.... (2) A Board may, if it considers it necessary or expedient in the public interest so to do, lend any of its vessels or appliances or the services of any of its employees to any person for such period not exceeding three months and on such terms and conditions as may be agreed upon between the Board and the person concerned. Section 42 - Performance of service by Board or other person (1) A Board shall have power to undertake the following services - (a) landing, shipping or transshipping passengers and goods between vessels in the port and the wharves, piers, quays or docks belonging to or in the possession of the Board; (b) receiving, removing, shifting, transporting, storing or delivering goods brought within the Board's premises; (c) carrying passengers by rail or by other means within the limits of the port or port approaches, subject to such restrictions and conditions as the Central Government, may think fit to impose; (d) receiving and delivering, transporting and booking and dispatching goods originating in the vessels in the port and intended for carriage by the neighbouring railways, or vice versa, as a railway adm....
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.... the Official Gazette, frame a scale of rates at which, and a statement of conditions under which, any of the services specified hereunder shall be performed by a Board or any other person authorized under section 42 at or in relation to the port or port approaches) - (a) transshipping of passengers or goods between vessels in the port or port approaches; (b) landing and shipping of passengers or goods from or to such vessels to or from any wharf, quay, jetty, pier, dock, berth, mooring, stage or erection, land or building in the possession or occupation of the Board or at any place within the limits of the port or port approaches, (c) carnage or porterage of goods on any such place; (d) wharfage, storage or demurrage of goods on any such place; (e) any other service in respect of vessels, passengers or goods, (2) Different scales and conditions may be framed for different classes of goods and vessels. Section 49A - Fees for pilotage and certain other services (1) Within any port, fees may be charged for pilotage, hauling, mooring, remooring, hooking, measuring and other services rendered to vessels, at such ra....
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....ged towards cargo handling activity. The Appellant have not paid the service tax on barging activity during the period November 2006 to May 2009. They also not charged any service tax to customers on receipts related to barging service. The new entry viz "Transport of Coastal Goods and Goods Transport through National Water ways and Inland Water Ways" was introduced from Finance Act 2009. Definition of Taxable Service as defined in Section 65(105)(zzzzl) reads as under "to any person, by any other person, in relation to transport of - (i) coastal goods; (ii) goods through national waterway; or (iii) goods through inland water. Explanation. - For the purposes of this sub-clause,- (a) "coastal goods" has the meaning assigned to it in clause (7) of section 2 of the Customs Act, 1962 (52 of 1962); (b) "national waterway" has the meaning assigned to it in clause (h) of section 2 of the Inland Waterways Authority of India Act, 1985 (82 of 1985); (c) "inland water" has the meaning assigned to it in clause (b) of section 2 of the Inland Vessels Act, 1917 (1 of 1917); From the above provision it is clear that i....