TaxTMI 
TaxTMI 
2008 (4) TMI 121
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....emises of the appellants and in the case of inadequacy of facility in their premises, they carried out these activities in the premises of Mumbai Port Trust. The premises of the appellant are situated in the jurisdiction of Mumbai Port Trust and are leased out to the appellant by the Trustees of Board of Mumbai Port Trust. 3. After investigation, the authorities below came to the conclusion that the appellant had erred in not taking out the licence and registration of the Service Tax and did not discharge the Service Tax liability. Show cause notices were issued to the appellant to show cause as to why Service Tax amounting to Rs. 6,17,97,695/- should not be demanded and recovered under the various provisions of Finance Act, 1994 and to show cause as to why penalty be not imposed and recovery of interest at the applicable rate. The appellant contested the show cause notice mainly on the ground that they are not covered under the category of services "Port Services", basically on the ground that their services are covered under repairs and maintenance and they did not render any other service other than repairs and maintenance. The adjudicating authority did not accept the contenti....
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....o the Major Port Trusts Act, 1963 is clearly uncalled for. He submits that Mr. G.P. Singh in his book "Statutory Interpretation" illustrates as under :- "It is not a sound principle of construction to interpret expressions used in one Act with reference to their use in another Act, any decisions rendered with reference to construction of one Act cannot be applied with reference to provisions of another Act, when the two Acts are not in pari materia." The meaning of the phrase pari materia was explained in the American case of Untied Society v. Eagle Bank - (1829) 7 Connecticut 457 as "Statutes are in pari materia which relate to the same person or thing." It is his further submission that the phrase "in relation to" has a wide-meaning. Hence, repair of a vessel is certainly within the purview of "in relation to a vessel" and it was taxable at the relevant time because the appellants were clearly authorized by Mumbai Port Trust for such repair service within the port area. He submits that the decision relied upon by the learned Counsel has not considered the words viz. "in any manner" as appearing in the definition of the "Port Services". It was submitted that these words were no....
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....sputed that the period of the appeal in this case is from 16-7-2001 to 30-3-2004. It is also undisputed that the appellant by virtue of the authority given to them by Mumbai Port Trust has further delegated the work of chipping, painting and repairing of ships and vessels to their various sub-contractors. In this factual position, the finding of the learned Commissioner (Appeals) needs to be read 'The activity of the appellant is to provide Ship repairing service and other marine repairs, paining, chipping etc. to ships and vessels. Section 65(67) of the Service Tax Act defines "port service" to means any service rendered by a port or any person authorized by such port, in any manner, in relation to a vessel or goods. A combined reading of Sections 35 and 42 of the Major Port Trusts Act, 1963 with Section 65(67) of the Service Tax Act clearly envisages that the said activities as carried out by the appellant is a port service in relation to a vessel/ship. The appellant has been necessarily provided with necessary registrations/licences by Port agencies or these port services on such terms and conditions as may be agreed upon as provided under Sections 36 and 42(3) of the Major Por....
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....the Act at the relevant time when their services became liable to Service Tax. In the instant case, the appellant are doing repair of vessels/ships and other activities for providing of "port services" within the meaning of Section 65(67) of the Service Tax Act read with Section 65(90)(zn) of the Service Tax Act. Further, Section 67 of the Service Tax Act provides that for the purposes of this chapter, the value of any taxable service shall be the gross amount charged by the service provider for such service rendered by him. The appellant were well aware of the provisions of the Major Port Trusts Act, 1963. They were also aware of the clauses of the licence between them and the Mumbai Port Trust. These facts are further evidenced from the lease licenses, which have been issued to the appellant to enable them to carry out ship repair services, and other services which is in the nature of services in relation to vessels/ships. There is no evidence that appellant has brought in the notice of department prior to investigations. All the correspondences rests after the investigation started by department. Thus, the extended period is applied in the instant case. In view of the above fact....
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....hority has held the appellant to be a person authorized by such port to undertake the activity of repairing of vessel. 9. The appellant is admittedly a partnership firm carrying on a business of all types of marine repairs for which purpose they are given a repair contract involving supply of material, steel removal job, fabrication, refitting, and overhauling of machinery, from the principle contractor like Mazagaon Docks Ltd. etc. For such purposes, they have been given vendor registration. They also receive direct contract of repair from foreign ship owners or through their steamer agent. 10. Revenue has placed reliance upon Section 35 of the Major Port Trust Act, 1963, which defines power of the Board to execute the work sub clause (I) to Clause 2 of the said Section stands invoked by Revenue in the impugned order. The said clause is to the effect that the work of the Board will include establishing of dry dock, slipways boats basins and workshop to carry out repair or overhauling vessels/tugs boats, machinery or other appliances. From this, it stand concluded by Revenue that in as much the Board's job is to execute the work provided in above Section, which in respect of perf....
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.... port area. As such, the subsequent expression appearing in the said clause has to be held as covering the services which are in relation to the movement of the vessel and has to be understood and construed by applying the principle of ejusdem generis. We may, at this stage, borrow the observations made by Hon'ble Supreme Court in case of Sidhdheshwari Cotton Mills (P) Ltd. v. UOI reported in 1989 2 SCC 458 = 2002-TIOL-206-SC-CX, reproduced hereunder: "12. The expression ejusdem generis - 'of the same kind or nature'-signifies a principle of construction whereby words in a statute which are otherwise wide but are associated in the text with more limited words are, by implication, given a restricted operation and are limited to matters of the same class or genus as preceding them. If a list or string or family of genus-describing terms are followed by wider or residuary or sweeping-up words, then the verbal context and the linguistic implications of the preceding words limit the scope of such words. 13. In Statutory Interpretation Rupert Cross (p. 116) says: The draftsman must be taken to have inserted the general words in case something which ought to have been included among t....
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....e in the appellant's argument that sub-section of Section 42 provides for authorization by the Board for the various services at the rate specified by that port in the Official Gazette. This has reflected upon the fact that various services, which can be authorized by the Board to any other person are routine services for which various rates can be fixed in advance. As far as the repairing of vessel is concerned, the charges would definitely depend upon the extent of work required to be done. We are informed that such consideration depends upon the contract arrived at after much negotiations. This fact leads us to hold that such contract services of repair of vessel cannot be held to be "port services". 15. During the course of arguments, it was also contended by Revenue that the appellant are given a licence and registration to carry out the services, which port is required to do. We have seen the by-laws governing grant of licence to carry out the work of vessels in the trustees dry docks. The same require the contractor/agent to submit an application for obtaining a licence for carrying out the work in dry dock. Such contractors must have facility such as enough number of paint....