TaxTMI 
TaxTMI 
2026 (3) TMI 1205
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....Purohit, (Power of Attorney Holder of M/s J.M.Baxi & Company), statements of Shri Mohanbhai Kalyanjibhai Bhanushali, (Supervisor of M/s Nav Bharat Exports, Delhi), Statements of Shri Nayan Jaysukhlal Shah, (Deputy General Manager of M/s Ashapura International Limited, Madhapar(Kutch)), statements of Shri K.R. Pradeep, (M/s Mincore Resources Private Limited, Chennai), statements of Shri Bipin Dashrathlal Parikh, (M/s Adani Ports Limited, Mundra), statements of Shri J.K.Jain, (Assistant Vice President of M/s Associated Transport Firm, Indore) statements of Shri Rajan Jacob M., (Power Attorney Holder of M/s ACT Shipping Ltd.), Statements of Shri Naresh Bavnani, (Authorized Signatory of M/s D.B.C. Sons Pvt. Ltd., Kandla (Kutch)) and various other concerned persons involved in the matter. After conducting investigation, show cause notice dated 11.07.2006 was issued to the appellant demanding service tax of Rs. 2,62,00,255/- for the period from 16.07.2001 to 16.02.2004 under Section 73 along with interest under Section 75 and penalty under section 75A, 76, 77 and 78 of the Finance Act, 1994. Notice was also issued to Shri Chhaganlal P. Maheshwari, Managing Director for imposing penalty u....
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....16.07.2001 to 16.02.2004 on them, does not sustain. They rely on the following decisions which hold that prior to 01.07.2010, unless authorized by the Port, Service provided by a person cannot be taxed under the category of Port Service. (a) Aspinwall & Co., 2011 (21) STR 257 (T) (b) Cairn Energy India Pvt. Ltd., 2010 (19) STR 110 (T) (c) South India Corporation (Agencies) Ltd., 2010 (17) STR 170 (T). (d) T. P. Roy Chowdhury & Co. Pvt. Ltd., 2010 (17) STR 58 (T) (e) Hasan Haji & Co., 2010 (17) STR 43 (T) (f) Velji P. & Sons (Agencies) P. Ltd., 2007 (8) STR 236(T) [maintained in 2009 (13) STR J 31(S.C.)], wherein, it is held that there is a difference between licence and authorization. (g) H. K. Dave Ltd., 2008 (12) STR 561 (T) (h) Seaways Shipping Ltd., 2008 (12) STR 229 (1) (i) South India Corporation Ltd,, 2008 (10) STR 484 (T) (j) Kinship Services (India) Pvt. Ltd., 2008 (10) STR 331 (T) * Hon'ble Supreme Court has held in the case of UOI vs Martin Lottery Agencies Ltd. 2009 (14) STR 593 (SC) that if a substantive law is introduced, it will have no retrospective effect. Therefore, ....
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....World View Vision, 2012 (26) S.T.R. 304 (Kar.) iv. Motor World & Others, 2012 (27) S.T.R. 225 (Kar.) 3. During hearing, Learned counsel pleaded that there was a requirement of specific authorization from the port authority for the period prior to introduction of Finance Bill, 2010. They are not liable to pay any service tax as the definition of "Port Service" was amended w.e.f. 01.07.2010 by which removing the condition of authorization from that date. The amended provision which came into effect from the enactment of Finance Bill, 2010, cannot be applied retrospectively. He further argues that it is an admitted position that Kandla Port authorities had not issued any license or authorization to the appellant. Consequently, demand confirmed by the adjudicating authority by altering the demand from port service to deemed port service is beyond the scope of show cause notice and hence, it may be set aside. He relies on Annexure-B to CBIC Circular dated 26.02.2010 which states that: "1. Services provided in an airport or port 1.1 Two services, namely, 'port services' and the 'airport services' were introduced in Budgets. 2001 and 2004 resp....
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....ers and Ship Repairers Association (Cited supra). This term would indicate permitting a person or agency to perform certain tasks subject to the prescribed conditions. In absence of such authorization, it may not be open to such person or agency to perform the tasks. He thus, pleads that when the appellant was performing port services within the port area, authorization is deemed to have been provided by the concerned port authority. He reiterates findings of the lower authority including cited case laws for sustaining the service tax demand as well as penalties on the appellant. 5. We have heard the rival submissions. We find that the Learned Commissioner in para 21 of the impugned order has mentioned that the appellant was providing stevedoring service, cargo handling services, supply of JCB, Payloaders, Barges, Tugs, Dumpers, Crain, Mobile Crain, Loading & unloading of Cargo, Internal Shifting of Cargo, Wagon Loading, Bagging, Stitching Bags with thread, stacking & Loading in the Port Area, etc. He mentions that some of these activities are covered under Cargo Handling Service and other services defined under the Finance Act, 1994 but since all the services are provided in Po....
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.... we find that in terms of that Section, the major port is supposed to carry out a number of activities and there is provision in terms of the said section for the port to authorize 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 case of Homa Engineering works by 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 let....
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....eld as under :- "6. After carefully considering the submissions made by both the sides, we find that the issue as to what service would get covered by the port services, scope of the "port service" was examined at length by the Tribunal in the case of Homa Engineering Works referred supra. In para 8 of the said judgment, it has been observed that taxable services under the net of "Port Service" means any service rendered by a port or any person authorized by such port. The services being provided by the appellant are handling, stevedoring, loading, unloading, tug hire and labour arrangement. Admittedly, such services are not required to be provided by the Port under The Major Port Trusts Act, 1963. A perusal of the Section 35 of the said Act, as reproduced in the case of Homa Engineering Works, clearly shows that power of the Board to execute the works and provide appliances do not include the above activities being undertaken by the appellant. As such, it cannot be said that the services being provided by the appellant were covered by the Port services. Further, the Tribunal in the above case has observed that the authorization from the Port must be in respect of the serv....
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....sued under Section 42 of MPTA". The difference between authorization under Section 42 of MPTA and a licence issued under Sec. 123 is clearly understood if the functioning of private container terminals (for e.g. P&O) terminal in Navaseva in Mumbai, Visakha Container Terminal at Visakhapatnam etc.) operating in various major ports and some of the berths operated by private persons on BOT basis, is examined. In all these cases where private parties are operating container terminals of berths, the functioning is independent of the ports which has given such authorization and in all such cases they are governed by the scale of rates fixed by TAMP (refer above) under Sec. 48 by way of notifications published in the Official Gazette. Take for instance in Visakhapatnam Port, the Visakha Container Terminal Pvt. Ltd. has been authorized by Visakhapatnam Port Trust to handle the container cargo that is coming to Visakhapatnam Port. Here the TAMP has fixed the scale of rates, under Sec. 48 of MPTA, by way of Notification published in the Gazettes of India (which is mandatory requirement under Sec. 42 of MPTA). The Stevedores and other port service providers, issued with licences by Ports, hav....
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....ed with driving licence, under no stretch of imagination, can be said to be functioning as Road Transport Authority. Authorization may be issued by way of licence, but not all licences are authorizations. Hence, the licences issued by Ports to various agencies (under Sec. 123 of MPTA) should not be confused with the authorization (may be by way of licence) issued under Section 42 of MPTA". The difference between authorization under Section 42 of MPTA and a licence issued under Sec. 123 is clearly understood if the functioning of private container terminals (for e.g. P&O) terminal in Navaseva in Mumbai, Visakha Container Terminal at Visakhapatnam etc.) operating in various major ports and some of the berths operated by private persons on BOT basis, is examined. In all these cases where private parties are operating container terminals of berths, the functioning is independent of the ports which has given such authorization and in all such cases they are governed by the scale of rates fixed by TAMP (refer above) under Sec. 48 by way of notifications published in the Official Gazette. Take for instance in Visakhapatnam Port, the Visakha Container Terminal Pvt. Ltd. has been authorized....