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2025 (11) TMI 1443
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....udicating authority. 2. The brief facts of the case in respect of HSCL is that they are a Public Sector Undertaking (PSU) engaged in carrying out certain construction works and other related activities in the steel plant, power plant, railways, etc. The issue relevant to this appeal is that HSCL were awarded contract for working at Visakhapatnam Steel Plant by M/s Rashtriya Ispat Nigam Ltd (RINL) and the same work was further sub-contracted to Visakha. The department, based on certain evidence and statements recorded, felt that their activities would fall under different categories including Cargo Handling Services (CHS), Management, Maintenance or Repair Services (MMRS), Commercial or Industrial Construction Services (CICS) and Manpower Recruitment or Supply Agency Services (MRSAS). Whereas, in the case of Visakha, who were sub-contracted the work by HSCL, their activities were considered falling under the heading of CHS. Insofar as subject matter of demand under the head CHS is concerned, it is not in dispute that demands on both HSCL and Visakha are on the same set of activities, where HSCL has outsourced certain activities on sub-contract basis to Visakha. 3. Since the ma....
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.... (Tri-Kol)]. This decision was upheld by Hon'ble Jharkhand High Court as reported in [2011 (23) STR 6 (Jhar)]. He has also relied on various other judgments, as under. a) Gaytri Construction Co. Vs CCE, Jaipur [2012 (25) STR 259 (Tri-Del)] b) Srinivasa Transports Vs CCE & ST, Visakhapatnam-I [2014 (34) STR 765 (Tri-Bang)] c) CCE & ST, Meerut-I Vs Jaspal Darshan Lal [2016 (45) STR 156 (Tri-All)] d) CCE Vs Manoj Kumar [2015 (40 STR 35 (All)] e) PR Nayak & Associates Vs CCCE & ST, Belgaum [2019 (26) GSTL 91 (Tri-Bang)] Management, Maintenance or Repair Service: 6. The demand is for the period July, 2003 to March, 2007 involving amount of Rs.95,98,924/- and Education Cess of Rs.1,18,139/-. Learned Advocate has submitted that the maintenance or repair service came into effect from 16.06.2005 and the major part of the demand is prior to 16.06.2005. Additionally, certain works mentioned in S.No.2,3,7 & 12 of the SCN cannot be classifiable under MMRS. He has also relied on certain case laws in support, as under. a) CCE, Jaipur-II Vs Dusad Transformer & Switchgears P Ltd [2007 (5) STR 37 (Tri-Del)] b) Uni Power System Ltd ....
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....araja Group & Associates Vs CCE, Raipur [2016 (41) STR 681 (Tri-Del)] f) Nizam Singh Chauhan, VJ Trivedi Vs CCE [2016 (41) STR 928 (Tri-Del)] g) Gajanand Agarwal Vs CCE, Bhubaneswar [2009 (13) STR 138 (TriKol)] 11. Heard both sides and perused the records. In Appeal No.ST/713/2010 - HSCL: Cargo Handling Service: 12. We find that the main thrust of arguments is that HSCL were basically engaged through their sub-contractor in transportation of steel products within the periphery of steel plant area and therefore, will not come under the category of CHS and the dominant intent of the contract is handling of steel materials/goods and not cargo. It was also contended that there are many other activities which are included in the said contract i.e., cutting of material into pieces, bending of steel material, bundling of steel material, de-coiling, straightening and cutting, etc., in order to facilitate storage and inspection etc. The second argument is that as per the definition of CHS till 16.05.2008, the goods were not within the purview of the said heading and only post amendment goods as well as cargo were brought within the ambit. We have gone through t....
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.... on the judgment of Coordinate Bench in the case of Sainik Mining & Allied Services Ltd Vs CCCE & ST, Bhubhaneswar [2008 (9) STR 531 (Tri-Kol)]. Para 5 is cited below for ease of reference. "5. Looking to the admitted facts of the case and finding Adjudicating Authority which remained uncontroverted throughout, applying aforesaid interpretation of the law, it may be held that the scope of activity carried out by the Appellant, inside the plant does not call for taxation under the class cargo handling service following decision of this Bench in the case of Sainik Mining & Allied Services Ltd. v. Commr. of CEx., Cus. & S.T., BBSR - 2008 (9) S.T.R. 531 (Tri.-Kol.). For convenience of reading Para-8 of the decision is reproduced as under :- "8. We find that the activity undertaken by both the appellants for mechanical transfer of coal from the coal face to tippers and subsequent transportation of the coal within the mining area, does not come under the purview of cargo handling service. The dominant activities undertaken by the appellants under the contract in question are primarily the movement of coal within mining area and transfer of coal from the coal face to the....
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....acts of the case at hand is different for that in Gajanand Agarwal where the whole payment was based on per metric tome or cargo loaded in railway wagons." 15. Similar view was also expressed by the Tribunal in the case of CCE, Rajkot Vs Abbas J Chavda [2013 (30) STR 387 (Tri-Ahmd)], relying on the judgment of Hon'ble High Court of Jharkhand in the case of CCE, Ranchi Vs Modi Construction Co [2011 (23) STR 6 (Jhar)]. 16. In the case of Manoj Kumar (surpa), Hon'ble High Court of Allahabad, referring to the decision of Hon'ble High Court of Jharkhand in the case of Modi Construction Co (supra) and the decision of Hon'ble High Court of Rajasthan in the case of SB Construction Co Vs UOI [2006 (4) STR 545 (Raj)], inter alia, held that transportation of goods viz., sugar bags was within the factory and the appellants were engaged in loading and unloading, stacking and re-stacking and shifting from one godown to another godown but the sugar bags were not loaded or unloaded for movement outside the factory or on public road or any ship, aircraft or truck for onward movement towards destination. 17. Therefore, in all these cases, what has essentially been found is that if the goods....
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....reight terminal, for all modes of transport and cargo handling services incidental to freight; and b) Service of packing together with transportation of cargo or goods, with or without one or more of other services like loading, unloading, unpacking but does not include, handling of export cargo or passenger baggage or mere transportation of goods. 18. Learned AR has mostly relied on certain judgments in support that these activities will fall within the ambit of CHS. In the case of Coal Carriers Vs CCCE & ST, Bhubhaneswar (supra), the Hon'ble High Court of Orissa, inter alia, examined the scope of CHS keeping in view its definition before 16.05.2008 as well as the nature of contract. The Hon'ble Court did not interfere with the order of the assessing officer holding certain activities as falling under the category of CHS, which was further upheld by the Tribunal. We find that the scope of work in the said matter was primarily restricted to loading and unloading of coal on the railway wagon for transportation out of mines, whereas, in the present case, the scope of work is much larger and different. Therefore, this case law is distinguished. In the case of Shre....
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....eas, they have not paid any service tax on similar contracts entered prior to 2005-06. Apparently, the argument of the HSCL is that prior to 16.06.2005, unless there was a maintenance contract, it could not have been brought under the ambit of the said service and that the contracts were not in the nature of maintenance. However, we find that from the scope of contract itself, it was very much in the nature of maintenance and repair contract and also the nature of activities performed by them was akin to maintenance or repair. It was not necessary that they had to undertake both the activities of maintenance as well as repairs and if they had either maintained or repaired or both, they will still be covered within the scope of the service. Therefore, we do not find any infirmity in the order of the adjudicating authority to this extent. Commercial or Industrial Construction service: 21. The adjudicating authority has examined the 3 contracts and held them liable to pay service tax under CICS. HSCL has primarily argued that insofar as the contract dt.01.05.2004 is concerned, it is their contention that it is in the nature of WCS and hence it cannot be leviable to service tax p....
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....ct, 1994." 22. Therefore, we do not find any infirmity in the findings of the adjudicating authority in this regard. Manpower Recruitment or Supply Agency service: 23. The adjudicating authority has examined three contracts and the main argument of the HSCL is that MRSAS was brought under tax net w.e.f. 16.06.2005, whereas, in relation to these contracts, the work was done by supplying manpower prior to that date and bills were raised subsequently and hence demand under this head was not maintainable. We find that in view of the contract, the services were provided prior to introduction of this levy and in fact, there is no dispute that even the services were provided prior to this date and merely because bills were raised later on for this service and payments were received later on, demand cannot be made in respect of these three contracts under the category of MRSAS. Therefore, to that extent, order of the adjudicating authority is liable to be set aside. 24. Coming to the issue of limitation, we find that the adjudicating authority has taken into account, inter alia, various factors including their being aware of the responsibilities of discharging service tax under....
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.... Corporation Ltd Vs CCE, Nashik [2009 (242) ELT 358 (Tri-Mum)], wherein, inter alia, the Tribunal held that in the light of presence of positive acts, their being a PSU, per se, cannot be a ground for not invoking extended period. Similarly, in the case of Chennai Port Trust Vs CST, Chennai [2017 (5) GSTL 394 (TriChennai)], it was, inter alia, held that being a PSU cannot be a plea against invocation of extended period. In the case of CCCE & ST, LTU-Delhi Vs Gas Authority of India Ltd [2019 (366) ELT 941 (Tri-Del)], similar ground was, inter alia, considered and was held that merely because the assesse is PSU, it cannot be a ground for setting aside the SCN. Para 24 is cited below for ease of reference. "24. Finally coming to the plea of show cause notices being barred by time; From the entire above discussion, it is clear that the product of the respondent has wrongly been classified by the respondent as Naphtha. It is also apparent fact that the Naphtha has much lesser Excise Duty as less as Rs. 15 per litre. In view thereof misdeclaration cannot be ruled out to be a strategy for tax evasion. We also opine that the act to the extent of even claiming exemption on the misd....
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....e tax cannot be the sole ground for deciding whether the extended period can be invoked or otherwise. We find that if there are other positive acts on the part of HSCL, which amounts to suppression or withholding of information deliberately or consciously, then even though they are PSU, the extended period is still invokable. We find that apart from their being PSU, they have contested the invocation of extended period on the grounds of this being a matter of interpretation of their having a bonafide belief. Insofar as the issue of interpretation is concerned, we find that there could have been some bonafide interpretational issue in the facts of the case with regard to the nature of cargo or mere transportation of goods within the plant, but they could have sought clarification from the department, especially, when they were otherwise registered under service tax and their being a big organization. However, they have not discharged service tax in a casual manner and only when the department was able to get full details of the contract and also got elaborate explanation thereto under investigation where certain statements were also recorded, the full facts came to the knowledge of ....