TaxTMI 
TaxTMI 
TaxTMI 
2023 (4) TMI 213
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.... alleged that such services of inter-carting appeared to be classifiable under "Cargo Handling Services". Investigation also revealed that appellant has also not paid service tax on inter-carting services provided to units located in SEZ. After the detail investigation a show cause notice was issued to the appellant proposing to demand of Service Tax along with interest and for imposing penalties. In adjudication, the adjudicating Authority vide order impugned herein confirmed the demand of Service Tax along with interest and imposed penalty and order for the appropriation of amount of service tax and interest paid during the investigation. Aggrieved by the said impugned order, the appellant is now before the Tribunal. 03. Shri Vishal Agarwal, Learned Counsel appearing on behalf of the appellant submits that for being taxed under the head Cargo Handling Service, a service provider has to render services in relation to cargo. The expression 'cargo' have not been defined in the Finance Act, 1994. However as can be seen from The New Lexicon Webster's Dictionary the expression 'Cargo' means - the freight of goods or luggage carried by a ship, aircraft. The movement / transport of good....
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....nt. There being no dispute about genuineness of the work order, Learned Commissioner ought to have gone by the terms of the same instead of basing his findings on mere statement. In any case, the legal position that movement of goods within the plant cannot be taxed under the head of Cargo Handling Services, does not get circumscribed by the said statement. 3.4 He argued that Section 66A of the Finance Act 1994 specifically provides the service is to be classified under that head of service which gives the same its essential character. In the instant case, transportation / movement of goods within the factory is the dominant purpose of the contract and as such, since these services are not taxable under the head Cargo Handling Services, the work order /contract cannot be said to be for rendering Cargo Handling Services. 3.5 He also argued that the entire dispute is revenue neutral inasmuch as if at all any service tax was payable, on the services rendered by appellant, the tax so paid was available as credit to M/s ESL. He placed reliance on the following judgments:- * CCE VS. COCA COLA 2007(213)ELT 490 * BRITCO FOODS LTD. VS. CCE -2001 (127)ELT 723 * COMMR. VS. INDEOS ABS ....
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....the SEZ Act and Rule 31 of SEZ Rules was available irrespective of whether or not the services were partly or wholly used within the SEZ. He placed reliance on decisions in the case of Norasia Containers Liner Vs. CCE, New Delhi - 2011 (23)STR 295. 3.9 He further submits that even in terms of Notification No. 9/2009 ST dated 03.03.2009 as amended by Notification No. 15/2009-ST dated 20.05.2009, complete exemption for services consumed wholly with the SEZ was extended. The services rendered by the appellant were wholly consumed within the SEZ. As such, the same are eligible for exemption in terms of the aforesaid Notifications. 3.10 He argued that investigation initiated by the DGCEI from April 2007 onwards, which ultimately culminated into SCN being issued on 10.01.2011, it is settled law that once the facts are within the knowledge of the Department, the extended period of limitation cannot be invoked. Therefore, from April, 2007 onwards, the extended period of limitation could not have been invoked. Further it is settled law that for invoking the extended period of limitation, mere non-filing of the return /non registration is not sufficient. Such an action must have been done ....
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....argo." Section 65(105)(zr) defines 'taxable service' as under - " "taxable service" means any services provided or to be provided to any person, by a cargo handling agency in relation to cargo handling services." From the definition given above, it is clear that loading, unloading, handling of cargo for all modes of transport and any other service incidental to freight would be covered by the definition of "cargo handling". The definition also very clearly specifies that mere transportation of goods will not be considered as cargo handling service. The definition itself clarifies that if the activity is only of transportation, then the said activity cannot be called as cargo handling service. Regarding the appellant's liability to service tax under the category of "Cargo Handling Services" it is seen that nowhere in the proceedings before the adjudicating authorities, the exact nature of work carried out by the appellant has been elaborated and applied to the statutory definition. The Learned Commissioner also in para 11 and 12 of impugned order admitted that work order issued by the M/s Essar Steel Ltd., to Appellant are not for transport of goods but includes several activi....
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....shed and unfinished goods within the factory premises could not come within the definition of Cargo Handling Service. The said paragraph is extracted below :- "4. In that view of the matter, since the activity of shifting the goods finished and unfinished goods within the factory premises could not come within the definition of cargo handling service and, therefore, this kind of service activity could not be termed as service activity." 5.3 We further find that the Hon'ble Allahabad High Court in the case of CCE v. Manoj Kumar - 2015 (40) S.T.R. 35 (Allahabad) held that if the cargo would not include loading or unloading for any movement to any destination, and the handling of cargo is only within the factory with reference to the storage; etc. then such activity cannot be brought under "Cargo Handling Services" in terms of Section 65(23) of the Finance Act, 1994. The Hon'ble Supreme Court in the case of Sushil & Company - 2016 (42) S.T.R. 625 (S.C.) upheld such reasoning with reference to the scope of the tax entry. The Hon'ble Apex Court observed that there are two conditions to be satisfied. There must be a cargo accepted by the transporter for carrying the goods from one pla....
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.... exclusively within the geographical location of SEZ. Any service used for the authorized operations of SEZ should be treated as services consumed within the SEZ. The services used for export of goods manufactured by SEZ are to be treated as those consumed within the SEZ. Further that, the provisions of SEZ Act has overriding effect over the provisions of any other law in terms of Section 51 of SEZ Act, 2005. Section 26 of SEZ Act, 2005 provides various exemptions and concessions from duties and taxes. A harmonious reading of Section 51 and Section 26 of the SEZ Act would reveal that the units of SEZ are eligible for exemption from service tax for authorized operations of SEZ units. Export goods manufactured by SEZ unit are the most important authorized operation of such SEZ unit. Hence, the services consumed for such operation is to be exempted under the Notification No. 4/2004. The word "consumption" used in Notification No. 4/2004 has to be construed as service rendered to a developer/unit in SEZ. The service recipient/unit is situated in SEZ and therefore eligible for the benefit of exemption. 5.6 Without prejudice, we also find that prior to introduction of Notification No. 4....