TaxTMI 
TaxTMI 
2021 (9) TMI 1585
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....lant is engaged in local transportation and wagon loading of Iron Ores. On wagon loading activities, the Appellant has discharged Service Tax liabilities under the category of 'Cargo Handling Services' however, no tax is paid on the value of local transportation of Rs. 8,15,68,879/-. 3. The learned Commissioner issued Show Cause Notice dated 09.02.2010 demanding Service Tax of Rs. 1,00,73,551/- under the category of 'Cargo Handling Services' on the said local transportation charges of Rs. 8,15,68,879/- received during 2007-08 along with interest and proposing penalties under Section 76/ Section 78 of the Act. The said Show Cause Notice culminated into the impugned order and the demand is confirmed on the ground that the local transportation is for short distances, hence, it amounts to shifting and such shifting is taxable under the category of 'Cargo Handling Services'. The learned Commissioner placed reliance on Circular NO. 232/2/2006- CX.4 dated 12.11.2007 issued by the Board. 4. The Appellant submits that, during the period under dispute they executed Work Order dated 09.08.2008 awarded by M/s. Rungta Mines Ltd., for wagon loading and local transportation. The rate for ea....
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....s separately provided in the contract. Further, M/s. Sara International Ltd., awarded Work Order dated 27.07.2009 for transportation and loading of Iron Ore with separate rate for each of them. The transportation against both the Work Orders were carried out upto lead/distance of 03 K.M. by mechanically propelled transport vehicles like Tipper, Hyva, Dumper etc. where the unloading is done automatically without any human intervention as these vehicles are fitted with Hydraulic Jack facility for automated unloading. 9. On merit, it is submitted for both the Appeals that the work executed by the Appellant is for local transportation which cannot be classified under the category of 'Cargo Handling Services'. 10. The Appellant further submits that demands in the instant cases are partly barred by normal period of limitation as the demands are for 2005-06, 2006-07 and 2008-09 & 2009-10 respectively where the Show Cause Notices were issued on 01.02.2007 and 09.02.2010, and while issuing the earlier Show Cause Notices, the department had acquired knowledge of the facts of the case, hence, suppression of facts etc. cannot be imputed warranting invocation of extended period of limitat....
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....laimed to be transportation but as per the show causing authority, it cannot be transportation activity but Cargo Handling activity. As per Para 8 of the show cause notice the rate is composite and no charges for loading, unloading is collected separately by the appellant. On perusal of the quantification of demand placed at Annexure-1 of the show cause notice (Page 309) it appears that there are separate contract for local transportation and wagon loading activities and the two contracts are distinct and separate and in the instant case service tax is already paid by the appellant on the wagon loading activities but no service tax is paid on the transportation/shifting activities on which service tax is now demanded. 4. The Learned Advocate for the appellant Shri Kartik Kurmy took us through the bills raised by the appellant for wagon loading and Local Transportation/Shifting to demonstrate that the wagon loading contracts and local transportation contract are separate. The appellant has already discharged service tax on wagon loading activities. In the show cause notice service tax is demanded only on the local transportation/shifting work (with incidental loading of tip....
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....mp Yard, transportation and unloading at Railway Siding. The appellant has already paid service tax on wagon loading activities which is clear from the quantification made in the show cause notice. 8. We find that the contract is essentially for the transportation of goods which incidentally involving loading of tipper/unloading of tipper at Railway Track head/Railway Siding which cannot be taxed under the category of Cargo Handling Service simply because rates for loading of tipper at Dump Yard and unloading of tipper at Railway Siding is not provided separately. The Learned Commissioner (Appeals) has erred in placing reliance on Circular No. B11/1/2002-TRU, dated 1-8-2002 which does not apply to the facts of the instant case. Further, it is nobody's case that the appellant is a Cargo Handling Agent to attract the levy under the category of Cargo Handling Services." 14. We find that separate rates in the work orders clearly indicates two separate contracts in one instrument. The learned Commissioner has erred in clubbing a divisible contract. The Tribunal in the case of Jai Jawan Coal Carriers Pvt. Ltd. Vs. CST reported in 2015 (37) S.T.R. 509 (Tri.-Del.), held thus :-....