TaxTMI 
TaxTMI 
2024 (12) TMI 12
X X X X Extracts X X X X
X X X X Extracts X X X X
....4 by Neyvelli Lignite Corporation Ltd. During the period in dispute the Appellants paid service tax under the category of "Site formation and clearance, excavation and earthmoving and demolition" services under protest. Subsequently when category of 'mining services' was specifically enacted in section 65(105)(zzzy) of the Act, the appellant started discharging the service tax under the said category and found that the tax was not payable under the earlier entry of site formation. The Appellant was of the belief that their services as specifically falling within the taxable net only with effect from 01.06.2007 which is specific taxable entry considering their scope of work and therefore they were liable to pay service tax only with effect from 01.06.2007. The appellant also believed that the significant and predominant nature of activity involved in the contract was that of transportation of goods and that cannot be classified under earlier category and hence the tax was not required to be paid. 1.2 He further explains that the appellant has subsequently classified the services as "mining services" and discharged the service tax liabilities accordingly and which fact has been su....
X X X X Extracts X X X X
X X X X Extracts X X X X
....o carefully perused the impugned order, more particularly para 7 to 10. We find that the impugned order merely relied upon the clarification issued by CBEC vide No. B1/6/2005-TRU dated 27-07-2005 and No. 23222/2/2006-CX.4 dated 12.11.2007. We find that as regard merit of the case the issue is whether the services provided by the appellant were classifiable under "mining services" defined in section 65(105(zzzy) of the Finance Act, 1994 and if that be so whether the services were liable to tax under site formation category prior to introduction of the "mining services" i.e. 01.06.2007. To decide the issue, it is imperative to see the scope of services provided by the Appellant. We refer to the 053289/0003J/RP/Cont.Mines/06 dated 14.09.2006 entered into by the Appellants with M/s. Neyvelli Lignite Corporation Ltd. for Barsingsar, Rajasthan, copy of which is supplied by the appellant in the paper book. We find that the contract is for "hiring of crawler mounted shovels / hydraulic excavators, backhoes, dumpers for the removal of all types of overburden materials in all kinds of strata, including its drilling, blasting, excavation, loading, transport and dumping, spreading, dozing at s....
X X X X Extracts X X X X
X X X X Extracts X X X X
....contract is to be decided by looking at the contract in holistic manner and which is here to win the minerals from the mine and transport them to appropriate places. 4.1 We now refer to the definition of "site formation and clearance, excavation and earthmoving and demolition" defined in clause (97a) of section 65 of the Act which is as follows :- "(97a) "site formation and clearance, excavation and earthmoving and demolition" includes, - (i) drilling, boring and core extraction services for construction, geophysical, geological or similar purposes; or (ii) soil stabilization; or (iii) horizontal drilling for the passage of cables or drain pipes; or (iv) land reclamation work; or (v) contaminated top soil stripping work; or (vi) demolition and wrecking of building, structure or road, but does not include such services provided in relation to agriculture, irrigation, watershed development and drilling, digging, repairing, renovating or restoring of water sources or water bodies;" 4.2 We also refer to the definition of taxable service given in section 65(105) as it concerns the above category which is as fo....
X X X X Extracts X X X X
X X X X Extracts X X X X
....retation of plain and literal interpretation has to be adhered to in fiscal laws. Accordingly, there is no room for intendment or addition to what is not forthcoming from plain language of statute. Language in clause (97a) and (zzza) is plain, unambiguous and clear and therefore nothing more can be added to expand scope of it. Regarding, the inclusive nature of clause (97a), which cannot be interpreted to indiscriminately extend its ambit to all conceivable activities. It is a settled principle of statutory interpretation that while an inclusive definition permits the inclusion of additional items, its scope is inherently constrained by the class or category to which the defined terms pertain. This principle ensures that definitions are not expanded beyond their legislative intent to include activities of an entirely different nature. Accordingly, the activities performed by the appellant under the said contract do not correspond to the specified activities or their class as contemplated under clause (97a). Consequently, they fall outside the purview of clause (zzza) as well. 4.3 Now we refer to the definition of taxable services i.e. mining service given in section 65(105)(zzzy....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... in which any operations in connection with such sand, refuse or other material is being carried on, being premises exclusively occupied by the owner of the mine; (xi) any premises in or adjacent to and belonging to a mine on which any process ancillary to the getting, dressing or preparation for sale of minerals or of coke is being carried on;" 4.5 We also refer to the definition of "minerals" given in section 2(jj) which means "all substances which can be obtained from the earth by mining, digging, drilling, dredging, hydraulicing, quarrying, or by any other operation and includes mineral oils (which in turn include natural gas and petroleum)". Examining the records in light of the given definition of "minerals", we find that the materials extracted from the mine be as overburden, are minerals. Further to it and by reading and interpreting meanings ascribed to the term "mine", we find as a fortiori that the activities undertaken by the appellant amounts to mining activity in a mine and therefore merits, without any hesitation and with legal backing, classification as mining activity. We also find from the records and findings of the lower authorities at all levels, th....
X X X X Extracts X X X X
X X X X Extracts X X X X
....to" has been held to be equivalent to or synonymous with as to "concerning with" and "pertaining to". The expression "pertaining to" is an expression of expansion and not of contraction." Thus, we find from the facts involved in the said contract that the activities undertaken by the appellant amounted to mining activity ipso facto. Following the decision of Doypack Systems P Ltd supra we also find that the activity relates to the mining of lignite which is mining of mineral. Accordingly, the services provided by the appellant are falling in the scope of clause (zzzy) of sub-section (105) of section 65 of the Act. 4.7 We also find from the given facts and records that the appellant has started to classify their activities under mining services i.e. clause (zzzy) which fact is evident from the Service Tax returns for the year 2008-09 and 2009-10 and accordingly discharged the service tax. We also find that the appellant has presented copy of final audit report issued by the department for the period ended on 31.03.2009 wherein no objection has been raised with respect to classification as mining services. Thus, looking to the facts that the services were classified by the appe....
X X X X Extracts X X X X
X X X X Extracts X X X X
....tioned in above Para 2.1 wherein, similar view was taken by the Tribunal therefore, we can conveniently view that the issue is no longer res-integra. It is also pertinent to note that the appellant, on the same service, paid service tax under the category of 'Mining Service' with effect from 1.6.2007 and it is admitted fact that the revenue had accepted the classification of the same service under 'Mining Service'. It also strengthens the case of the appellant that the service provided by them is of 'Mining Service' and does not fall under the category of 'Site Formation and Clearance, Excavation and Earth Moving and Demolition Services'." 4.9 Similar stand has been taken by Kolkata Bench of this Tribunal in case of Saumya Mining Pvt Ltd v. CST - 2024 (7) TMI 753 and G. S. Atwal & Co Engineers Pvt Ltd v. CST - 2023 (6) TMI 310. 4.10 Regarding the issue of classification between clause (zzzy) or (zzza) in terms of section 65A, it is necessary to evaluate the position as it existed in the statute on or after 01.06.2007 since prior to that clause (zzzy) was not existing. Considering that position after 01.06.2007, we find that the clause (zzzy) lays down more specific entry of t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....; (b) composite services consisting of a combination of different services which cannot be classified in the manner specified in clause (a), shall be classified as if they consisted of a service which gives them their essential character, in so far as this criterion is applicable; (c) when a service cannot be classified in the manner specified in clause (a) or clause (b), it shall be classified under the sub-clause which occurs first among the sub-clauses which equally merit consideration." From the above provision for classification of taxable service, it is provided that if taxable service is prima facie classified under two or more sub-clauses of clauses under Section 65, classification shall be effected on the basis of sub-clauses which provides the most specific description as compared to sub-clauses providing more general description. In the facts of the present case, it is undoubtedly clear that between appellant and the service recipient M/s. GMDC even though the nature of activity independently is of excavation and removal of soil but the objective of this activity is for mining only. In case of any mining activity, the activity of removal of ove....
X X X X Extracts X X X X
X X X X Extracts X X X X
....law as it stood at the relevant time, we do not find any merit in the decision taken in the impugned and thus we hold that the services provided by the appellant under the said contract are in the nature of mining services so defined in clause (zzzy) of sub-section (105) of section 65 of the Act and not falling within the meaning of "Site formation and clearance, excavation and earthmoving and demolition" defined in clause (97a) of section 65 of the Act. We also hold by following the principles laid down by the Apex Court that the said services cannot be subjected to tax prior to 01.06.2007 and accordingly the appellant merits refund of amounts paid by them. 4.13 However, facts relating to the contract number 53223 dated 07.12.2004 are not verifiable since the appellant have neither supplied the copy of the contract nor the relevant invoices. All the issues involved in the present case are significantly and dominantly factual issues in nature and therefore careful examination of the facts emanating from contemporaneous evidences is indispensable before reaching to any conclusion otherwise that will be complete miscarriage of justice to the other side. Thus, in absence of relevan....