TaxTMI 
TaxTMI 
2009 (5) TMI 60
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....g and forwarding and stevedoring services. They had entered into contract with the following parties. (i) M/s. Vikram Ispat (ii) M/s. Ispat Industries (iii) M/ s. Steel Authority of India (iv) M/s. Chhatisgarh Electricity Company Limited (v) M/s. Deccan Mining Syndicate (P) Ltd. In respect of Order-in-Original No.2/2007 dt. 3.5.2007. (i) M/s. Tamilnadu Electricity Board and (ii) RINL in respect of Order-in-Original No. 1/2007 dt.3.5.2007. 4. On the basis of the intelligence received, the Service Tax officers conducted investigations. On the basis of investigations, revenue was of the view that the appellants had evaded payment of Service Tax on various services (taxable) rendered by them. Show cause notice dt. 23.1.2006 and 18.1.2006 were issued to the appellants for payment of Service Tax payable on "Port Services" rendered by them. The details of the show cause notices are given below in the tabular column. Sl. No. Date of show cause notice Amounts involved 1. 23.1.2006 (i) Service Tax of Rs.1,11,78,544/- on "Port Services" (ii) Service Tax of Rs.22,630/- on "CHA Services" (iii) Education Cess of Rs.58,210/- on the value of taxable services (iv) Penalties under S....
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....accepting that the appellants are persons authorized by the port, the demand is hit by bar of limitation. The Commissioner has not considered the case laws cited by the appellants. Even in the Velji P. and Sons decision, it was observed that there was confusion on the part of officers as regards correct scope of services being provided by the appellant. Therefore, short levy if any is not on account of mala fide intention on the part of the appellant and no suppression or misstatement with a view to evade duty can be attributed to him. This has not been considered by the Adjudicating Authority. (iv) The first order has confirmed a demand of Service Tax amounting to Rs.60,40583/- our of which Rs.37,09,474/- was allowed as credit available for payment of demand confirmed and an amount of Rs.10,72,011/- paid by the appellant during investigation was appropriated and the balance is Rs.12,59,098/-. Out of the above amount demanded, an amount of Rs. 5,62,606/- is Service Tax demanded on the amounts paid by the appellants to M/s. VPT and M/s. Dock Labour Board (DLB) during the period 16.7.2001 to 15.8.2002 which were already subjected to Service Tax through M/s. VPT and DLB on the ground....
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....ies. Handling and stevedoring; unloading of material, loading and shifting cargo from the designated plot to the vessel; liasioning; unloading of imported manganese ore from vessel; transportation up to designated port plot and stacking; reloading on the road transport bucks/railways rakes with proper liasioning coordination with port authorities; unloading of wagons; loading cargo from wagon siding to tipper; transportation from wagon siding to stockyard at VPT; at outer harbour of VPT, they undertake unloading of wagon/trucks, loading onto tippers; transportation from wagon siding to outside stockyard, high stacking; loading on to tippers, transportation to OHC plot, feeding to reclaimer; water sprinkling; at inner harbour, they undertake wagon/truck unloading; loading onto tippers; transportation to outside plot and high stacking, loading at stockyard to tippers; transportation from stockyard to vessel hook point stevedoring and water sprinkling, etc. 8.1 On going through the above, it is very clear that the appellants undertake various activities inside and outside the port on behalf of their clients. The appellants are basically Custom House Agent (CHA). They also undertake ....
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....e Tax on the stevedoring activity undertaken by them within the port area. She has given allowance for the Service Tax already paid by the port and which has been collected from the appellant. 8.5 She has also given a finding that the value of transportation taken for calculation of total amount liable under 'Port Service' in the show cause notice issued to the assessee has to be excluded. The Service Tax on account of this in the first order is Rs.46,59,090/-. In the second order, the corresponding amount of Service Tax on account of inclusion of transportation is Rs.2,90,24,713/-. 8.6 The assessee's request for exclusion of expenses incurred with M/s. VPT and M/s. DLB had not been accepted by the Commissioner. She has given a finding in the first order "I am of the view that there was no provision during 16.7.2001 to 15.8.2002 for removal of this value on taxable services provided by M/s. VPT and M/s. DLB as inputs stevedoring service provided by the assessee to his clients and therefore, reject the assessee's plea to reduce the demand to the extent of Rs.5,62,606/- being the Service Tax paid by M/s. VPT and M/s. DLB from 16.7.2001 to 15.8.2002 on input services during this per....
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....ze any other person to render such services after taking prior approval of the Central Government. In the present case, the appellants strongly contend that the services rendered by them are not on behalf of the ports but on their own behalf. In other words, the appellants render directly the services and the licence is only a permission to undertake such services within the port premises. Therefore, it cannot be interpreted that the appellants are rendering any service on behalf of the port. We also find that the issue has been gone in depth in the cited decision of the Mumbai Tribunal wherein the Tribunal held that the port is supposed to give only facility for ship repairing and it is not expected of a port to directly render the services of ship repairing. Interpreting Section 42 and the provisions of the Service Tax in the Finance Act, the Mumbai Tribunal even held that the Board's circular issued on this behalf is not in accordance with law. Moreover, the appellants have produced a letter from the Mangalore Port Trust which clearly say that the appellants are rendering the services directly and not on behalf of the port. In these circumstances, there is much force in the appe....
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....cannot be taxed a second time, because she has allowed credit of Service Tax paid by the Port and DLB (to the tune of Rs.37,09,474/-) holding that the services rendered by the Port and DLB are input services. The order has resulted in allowing credit of tax paid, holding them as input services and at the same time excluding such input services from the total assessable value, a double jeopardy to revenue. Moreover, this vitiates the law that the Service Tax has to be paid on the gross amount charged by the service provider or such service provided or to be provided by him. (ii) Similarly, with regard to transportation, the Commissioner has held that the assessee is licensed for stevedoring operations and not for transport. It is pertinent to reiterate that the assessee enters into a comprehensive contract with his client for carrying out stevedoring work at the Port and this job includes transportation. In this connection, it may be seen that the Board, in Letter F.No. Bl 1/1/2002-TRU, dated 1.8.2002 [reported in 2002 (51) RLT M135] has clarified with regard to 'cargo handling services' as under: 4. A point has been raised as to what would be the value of service tax in a case wh....