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Landmark Service Tax Judgment - Port Services

Taxable Services - Port Services

Case Laws Related

  • STO 2013 CESTAT 1225
  • Port Service: Demand: Stay: Applicants had collected the entire tax from the client M/s. Kolkata Port Trust and had retained the amount with itself without remitting it to the Government, did not file ST-3 returns: Directed to deposit entire adjudicated liability towards service tax within four weeks.

  • STO 2013 CESTAT 1217
  • Manpower Supply Service: Port Service: Demand: Stay: Appellants have undertaken chipping and painting work to Indian Navy Vessels and after going through the notification and the documents, this work was undertaken for navy is exempted as claimed: Directions for partial pre deposit issued for other services.

  • STO 2013 CESTAT 980
  • Port Service: Demand: Stay: Taking into consideration that there would not be any liability of the applicant as on date as the entire amount of advances collected from the port users had been subjected to service tax and have been paid by them: Pre deposit waived.

  • STO 2013 CESTAT 871
  • Port Service: Repairing of Vessel or ship from outside in dry area by a person authorized by the port authorities: As per Board Circular there was doubt about its taxability under Maintenance or repair or Port Service: Demand set aside on merit as well as on limitation.

  • STO 2013 CESTAT 627
  • Port Service: Demand: Stay: When the port dues are collected, value of this service rendered within the port would form part of port dues. It is further evident from the agreement that whatever the amount, the appellant received would be from the port dues only and no additional amount was paid by the Government of Andhra Pradesh. In these circumstances, it becomes clear that the amount of 15% of actual expenditure paid to the appellant is port dues collected from port users. It is settled law that the same service cannot be taxed twice under the same head: Prima facie case found: Pre deposit condition waived.

  • STO 2013 CESTAT 304
  • Port Services: Demand: Stay: As the appellant's barges are utilized for movement of cargo from ship to shore and vice versa and that the appellant is charging the consideration per tonnage of the goods hauled: Prima facie case for waiver not found: Directions for partial pre deposit issued.

  • STO 2012 CESTAT 971
  • Port Service: Supply of water to vessel also a service to the vessel, hence, covered under Port service and cannot be considered as sale of water: Supply of Tangible Goods: Providing boats/barges on rent: Prima facie case not made out: Directions issued for pre deposit.

  • STO 2012 CESTAT 910
  • Port Service: Supply of water and stores to the vessel from the barge is not merely supply of water, it is a port service: Directions issued for partial pre deposit.

  • STO 2012 CESTAT 835
  • Cargo Handling Service: Port Service: Stay: services rendered by the appellant was in respect of the Cargo/ vessels for handling the goods in the Port and loading/unloading of the goods from vessels into barges etc. It is also undisputed that the said services were rendered within the port premises. Services would fall under Port Service and not Cargo Handling Service: Stay granted.

  • STO 2011 CESTAT 258
  • Service Tax: Port services or Cargo handling service: Classification: Refund: Board vide Circular No.B11/1/2002-TRU, dt 1.8.02 clarified that Cargo handling services are provided in the port also. Port service cover any service provided in relation to goods or vessels by a port or a person authorized by the port. This includes the cargo handling service provided within the port premises.(Para 2) The impugned order of Commissioner (Appeals) is set aside and the appeal is allowed.(Para 4)

  • STO 2011 CESTAT 263 LB
  •  Service Tax: Port service: Answers by Lerger Bench: The questions referred to Larger Bench are answered as under:

    (a) Provisions other than clause (q) of Section (2) of the Major Port Trusts Act, 1963 or any provisions other than clause (4) of Section (3) of the Indian Ports Act, 1908 are not applicable to interpretation of "port service" defined under Section 65(82) of the Finance Act, 1994 in absence of statutory intention thereof.

    (b) Stevedoring in a major or minor port is a "port service" within the meaning of this expression defined under Section 65(82) of the Finance Act, 1994 following judgment of Hon'ble High Court of Karnataka in Konkan Marine case - 2009 (13) S.T.R. 7 (Kar) = STO 2008 Kar 747.

    (c) Activities/operations like intercarting (transportation of cargo after its unloading from a vessel, to a place of storage within the port area), storage of cargo in plots allotted by the Port, blending of different grades of coal in the port area and other kinds of cargo handling in the port area (other than export of cargo) can be held to be services ancillary to stevedoring and classifiable as "port services" under Section 65(82). Registry is required to place the respective cases before appropriate Bench to decide the Appeals. (Para 12,14)

  • STO 2011 CESTAT 256
  • Service Tax: Refund:The original adjudicating authority to verify whether relevant details are available in lorry receipt or not. If they are not available the photocopy of the lorry receipt can be taken and made part of the order-in–original so that it becomes clear that the original documents do not have the relevant details relating to export goods. The amount of service tax paid towards GTA services for binging empty container to the factory for stuffing should have been allowed. As regards port services, if service tax was paid for rendering port services the amount of service tax paid can not be denied to be refunded. The Notification No. 41/07-ST dated 06.10.07 itself provides clearly that the relevant date for determination of limitation is the date on which proper officer of Customs makes an order permitting clearance and loading of the goods for exportation. Therefore, the finding that the claim is time barred because it is filled beyond the period when counted from date of ARE-1 is appears to be against the provisions of Notification. Provisions of Section 83 of Finance Act, 1994 clearly provide that provisions of Section 11BB are made applicable to service tax matters. These aspects have not been verified before rejecting the refund claim by both the lower authorities. The impugned orders are set aside and the matter is remanded to the original adjudicating authority.(Para 2)

  • STO 2011 CESTAT 128
  • Service Tax: Port Services i.e. for activities like chipping, cleaning, painting etc done on marine vessels within port premises: Demand: Now that the Hon'ble High Court has framed the relevant issue for a decision in the case of Homa Engineering Works (supra), it will be appropriate to remit the case to the learned Commissioner. Therefore, the impugned order is set aside and allow this appeal by way of remand to the learned Commissioner to take appropriate decision on the substantive issue and ancillary issues after the Hon’ble High Court settles the question of law framed by it in Home Engineering Works' case. (Para 5). 

  • STO 2011 CESTAT 84
  • Service Tax: Service Tax under 'Port Services' on royalty, upfront charges, rent on jetties and estate rentals received: Demand: Waiver of pre-deposit: Royalty charges were paid by IGTPL to develop and operate RGCT within the port premises. This amount was not a consideration for any taxable service rendered by the appellant and could not be subjected to Service Tax. The licence fees received were charges for leasing out immovable property in terms of the agreement. When renting out of immovable property was brought under tax net, they have paid the appropriate Service Tax due. The upfront charges were sale consideration for transfer of various equipments by the assessee to IGTPL in terms of the agreement entered into between CPT and IGTPL. It is argued that sale consideration could not form part of taxable value. Demand of Service Tax on amounts received for renting out jetties within the port area was illegal and not sustainable, since the said amount was not recovered as consideration for any service rendered.(Para 3). Therefore, the impugned demand and penalties are set aside and allow the appeal.(Para 6.1).

  • STO 2010 CESTAT 659
  • Service Tax : Port Services : Penalty : Section 80 : Discretion to reduce penalty : In the case of Vinay Bele and Associates the main contention on behalf of the Revenue was that authorities has no discretion to impose less penalty under Section 76 of Finance Act, 1994. The Hon'ble High Court observed that after considering Section 80, such discretion is available to the authority. In the case of S. R. Enterprises, the Hon'ble High Court observed that decision of the Tribunal in the facts and circumstances of that case to reduce the penalty under the provisions of Finance Act was in exercise of existing powers to reduce the penalty. In the case of Madhuri Travels, the Hon’ble Bombay High Court again observed that there is power in the authority on showing reasonable cause not to impose or reduce the amounts of penalty. Assessee has shown reasonable cause and therefore, there is no need for enhancement of penalty. Accordingly, the appeal filed by the Revenue is rejected. (para 8, 9,10).

  • STO 2010 CESTAT 676
  • Service Tax: Port Services: Lighterage and transportation within the vicinity of port area and stevedoring & loading/unloading of cargo meant for export: Pre-deposit: The issue is already covered by the decisions cited by the learned advocate. Therefore the appellant has been able to make out a prima-facie case in their favour. Accordingly the requirement of pre-deposit of the service tax demanded, interest thereon and penalty are waived and stay against the recovery of the same is granted during the pendency of appeal. (para 3).

  • STO 2010 CESTAT 577
  • Service Tax: Port service : Demand: Taxable event: The expansion of definition of 'Port services', which has been brought into play by the Finance Act, 2010, would seeks to include all services provided entirely within airport/port premises would fall under these services i.e. 'Port services' and there is no pre-condition of any authorisation from the port authority for taxing the services. It is also seen from the Circular dated 26th February, 2010, the scope of modifications or expansion of definition of 'Port services' would come into effect from 08.05.2010 i.e. after the enactment of the Finance Bill, 2010. It would imply that the modified/altered or expanded definition of 'Port services' would definitely encompass the services rendered by the appellants herein from 08.05.2010. It is an admitted fact that the relevant period in all these cases is prior to 08.05.2010. Hence, the contentions raised by the counsels for all the appellants that the Finance Act, 2010, has removed the lacuna in the earlier port services, is correct.(Para 17).Hence, the services rendered by the appellants would not fall under the category of 'Port services'. As the impugned orders are set aside on merits, there can be no case of penalty or interest in respect of this issue.(Para 18).

    Non-Speaking order: Adjudicating authority has not given any reasoning for holding that the amount of CENVAT credit availed needs to be recovered. In the absence of any reasoning and finding, suffice to say that the said order is non -speaking order,(Para 19,20). Appeals disposed accordingly.
     

  • STO 2010 CESTAT 315
  • Service Tax: Port Services: Service received from foreign consultant, re-imbursement of expenses and royalty payments: Interest & Penalty: Since the appellant has not challenged the amounts as indicated herein above, the appellant is also liable to pay interest on the said amounts. The penalty on the above three items will be restricted as per the provisions of Section 76 & 77 of the Finance Act, 1994. Since the royalty payments for services rendered by the foreign consultant to the appellants would be liable, for service tax from 18/4/2006 only, penalty under Section 78 of the Finance Act, 1994 is unwarranted. (para 6)

    Service Tax: Port Services: Cenvat Credit: Input Services: Insurance charges have been paid by the appellant for the insurance taken for the individual employees who are working within the port area. Decision in the case of Stanzen Toyotetsu India Pvt. Ltd. (supra) squarely covers the issue in favour of the appellant. Set aside that portion of the impugned order wherein the adjudicating authority has confirmed the demand and imposed penalties and sought interest on the credit availed on the service tax paid on insurance charges. (para 7)

    Service Tax: Port Services: Cenvat Credit : Capital Goods: The reversal of the balance 50% of the amount as sought by the adjudicating authority, would be only an academic exercise as the appellant would have got the credit in the next year. Having utilized the said amount, the appellant is liable to pay the interest for the period he utilized the said credit for the discharge of service tax liability. Lower authorities may work out the amount of interest liable to be paid by the appellant on this issue. Since the demand is set aside, the question of imposition of penalties on the appellant on this count does not arise. (para 8)

    Service Tax: Port Services: Terminal charges / port charges retained out of the sale proceed of auction of goods that were not cleared by the importers: The auctioning of the goods not cleared by the importer is not a port service rendered by the importer and hence cannot be subjected to any service tax. The impugned order to the extent it confirmed the demand on the count is liable to be set aside. Interest and penalty on this count are also liable to be set aside. (para 9)

    Service Tax: Port Services: Charges for use of infrastructure facility for examination of the cargo by the customs authorities before it enters into port area : These charges collected at the pre-stage yard for the examination of the goods by the customs authorities would not get covered under the category of port services. The impugned order to the extent it confirms the demand and imposed the penalty and demands the interest is set aside. (para 10)

    Service Tax: Port Services: Amount received from CNCOR: Since the amount which has been received by the appellant is an amount on which service tax liability has already been discharged by M/s. CONCOR, the said amount cannot be held to be taxable under the category of port services in the appellant's hand. In view of this, service tax liability confirmed by the adjudicating authority on this point and consequent penalties and demand of interest are not sustainable and are set aside. (para 11)

    Service Tax: Port Services: Cenvat Credit: Input Services: Credit availed on inadmissible documents: Remand: These documents indicate some kind of transactions on which the service tax liability was debited by the bankers. Since these documents were not produced and not explained before the adjudicating authority, the matter is remitted to the adjudicating authority to reconsider this issue afresh. (para 12)

  • STO 2010 CESTAT 294
  • Service Tax: Cargo handling, Port Services and Clearing and Forwarding Service: Notification No. 41/2007-ST dated 6.10.2007: Refund: Remand: In the impugned order the refund claim was rejected for non-production of the evidence asked by the Commissioner (Appeals) during the course of personal hearing. In that circumstance it would be appropriate in the interest of justice to remand back the matter to the original adjudicating authority to verify the documents again and if it is found the appellant is entitled to refund claim as per Notification No. 41/2007-ST dated 6.10.2007, or not? (Para 8,9)

  • STO 2010 CESTAT 154
  • Service Tax: Port Services: Pre-Deposit: Tribunal decision in the case of Velji P. & Sons, which stands confirmed by the Hon'ble Supreme Court, is prima-facie applicable to the facts of the instant case. It stands held in the said judgment that activity of handling, loading, unloading and labour arrangements etc. does not fall under category of port services and there is a difference between licence and authorizations. The appellant is entitled to unconditional stay in respect of demands confirmed on the services rendered by them, by treating the same as port services. (para 3)

    Service Tax: Manpower, recruitment or supply agency services: Pre-deposit: An amount of Rs. 2.35 lakhs approximately relate to the salaries paid to foremen/khalasees etc. which stand covered under the service of 'manpower, recruitment or supply agency services. The appellant should be directed to deposit the amounts in question. (para 4)

  • STO 2010 CESTAT 509
  • Service Tax: Port Services: Demand: As regards royalty, we find that CPT received part of revenue earned by IGTPL as consideration for allowing IGTPL to operate the port whereas IGTPL rendered services taxable under port services and paid the tax due on the total revenue. We do not find 1/3rd of that revenue received by CPT liable to tax under Port Services at the hands of the appellant.(Para 5.1). ii) Rent amount : As regards the rent collected from individuals/agencies for allowing them to construct and operate jetties, it is rent and not value for port services rendered. The persons/individuals operating the berth would be required to pay tax on port services if they render such services; Demand raised under this head is not sustainable. (Para 5.2). iii) As regards boat registration .fee, the assessee admitted the liability and honored the demand (Para 5.3). Appeals allowed.

  • STO 2009 CESTAT 1394
  • Service Tax: Waiver of pre-deposit of duty, penalty and interest: The issues in dispute are mostly settled in favour of appellants, but needs further detailed hearing. Applicant has made out a prima facie case of the waiver of the pre-deposit of the amounts involved and as they have already deposited Rs.5,93,363/- towards service tax liability in respect of Consultancy in Real Estate Services, this amount as enough to hear and dispose the appeal.(Para 3).

    Stay granted.

  • STO 2009 CESTAT 1389
  • Service Tax: Port Service: Scope and liability: The appellants had been issued with a registration certificate on the strength of which it rendered C & F agent service and steamer agent service in the port area. `Port service' means any service rendered by a port or other port or any person authorized by such port or other port in any manner in relation to a vessel or goods. The demand has been confirmed towards service tax found due from the appellants under the category `port service' on the basis that the appellants had rendered the impugned services on the strength of authorization by NMPT. This Tribunal has held that such registration certificate or licence does not constitute authorization by the port as envisaged in the definition of `port service ' under clause 82 of Section 65 of the Act, in Konkan Marine Agencies vs. Commissioner of Central Excise, Mangalore [STO 2007 CESTAT 323 and Velji P. & Sons (Agencies) P. Ltd. vs. Commissioner of Central Excise, Bhavnagar [STO 2007 CESTAT 542, it was held that the impugned activities were not required to be provided by the port under Major Port Trusts Act, 1963. The registration certificate or licence issued by the port authorities cannot be considered as the authorization envisaged in the definition of `port service'. In the circumstances, the impugned demand fails. (Para 4).

    Appeal allowed.

  • STO 2009 CESTAT 1497
  • Service Tax: Port Services: Scope: The issue is of the classification of the services under the "Port Services". The issue is covered in favour of the assessee by the decision of the Hon'ble High Court of Karnataka in the case of CCE Mangalore Vs. Konkan Marine Agencies (2009 (13) STR 7(Kar). At the same time, applicant has deposited almost 50% of the demand amount.(Para 4).

    Stay granted.

  • STO 2009 CESTAT 1077
  • Service Tax: Whether the benefit of abatement of value of materials under Notification No. 12/03-ST dated 20.06.2003 is available to assessees if no material was sold but only consumed in rendering ‘photographic service’ period 01.10.2003 to 09.09.2004 and 01.10.2004 to 31.03.2005: The issue as to whether the value of export materials consumed in providing ‘photographic service’ is required to be abated from the assessees value of such services stands settled in favour of the assessees by the apex court’s decision in 2009 (14) S.T.R. J.163, upholding the Tribunal’s order in shilpa Color Lab Vs Commissioner of Central Excise, Calicut [STO 2006 CESTAT 721 and Shri Roopchhay Colour Studio Vs Commissioner [STO 2007 CESTAT 1419 ](Para 2).

    Appeal allowed.

  • STO 2009 CESTAT 968
  • Service Tax: Port Service: Activity of making necessary arrangement for interconnecting of Port Trust Railway System with Railway system as terminal service: In the present case, the Revenue is demanding service tax under the category of port service whereas the Commissioner of Service Tax in respect of Port Trust, Chennai passed the adjudication order demanding service tax in respect of the same service as provider of Business Auxiliary Service. The Revenue accepted the decision of the Commr. of Central Excise, Chennai. In these circumstances, the Ld. Jt. CDR to get instruction from the CBEC whether the service in question provided by Port Trust comes under Business Auxiliary Service or under the Port Trust service.(Para 4,5).

    Stay allowed.

  • STO 2009 CESTAT 945
  • Service Tax: Port Services: Scope: Waiver of Pre-Deposit: As regards the leviability to Service Tax under the category of 'Port Services', it was stated that by virtue of the decision of this Bench in the case of Konkan Marine Agencies Vs. Commissioner - STO 2007 CESTAT 323, the disputed services would not be charged to Service Tax under the category of Port Services. The said decision has also been confirmed by the Hon'ble High Court of Karnataka. Pre-deposit waived.(Para 1,2).

    Stay allowed.

  • STO 2009 CESTAT 625
  • Service Tax: Stevedoring Services: Scope and liability: The impugned order has demanded Service Tax on the ground that the appellants rendered 'Port Services' which is taxable in terms of the Finance Act. The appellants in fact are rendering 'Stevedoring Services' in the Mangalore port. On this issue, this Bench in the case of Konkan Marine Agencies Vs. CCE - STO 2007 CESTAT 323 had already held that the 'Stevedoring Services' would not be liable to Service Tax under the category of 'Port Services'. The said decision has been affirmed by the Hon'ble High Court of Karnataka. In these circumstances, full waiver of the pre-deposit of the dues demanded is allowed(Para 3).

    Stay granted.

  • STO 2009 CESTAT 243
  • Service Tax: Stevedoring service or port service: Demand: They have been paying Service Tax in terms of Public Notice No.5/97 dated 12.6.1997 at 15% on the gross receipts. This was examined by the revenue and proceedings were initiated. However, this Bench has stayed the issue in its Stay Order No.1151/2006 dated 18.10.2006. With effect from 1.4.2004, the appellants in addition to other services started rendering the services of stevedoring also. However, while they were paying Service Tax at 15% of the gross receipts, revenue proceeded to levy Service Tax on the balance 85% on the ground that the appellants are rendering 'Port Services'. This issue is squarely covered by decision in the case of Konkan Marine Agencies Vs. CCE, Mangalore - STO 2007 CESTAT 323 wherein it was held that the stevedoring activity carried out by the appellant would not come within the purview of 'Port Services'. The said decision has been confirmed by the Karnataka High Court by Order No.CEA No.12/2008. Therefore, it is very clear that stevedoring activity cannot be taxed under the category of 'Port Services'. The department was all along knowing what the appellants have been doing. There was actually no suppression of facts with an intention to evade Service Tax. Hence, there is absolutely no justification in invoking the larger period for the demand.(Para 2,4).

    Stay granted.

  • STO 2009 CESTAT 469
  • Service Tax: “Port Services” is for the period Apr. 02 to Nov. 05: Double taxation: Scope: Port Trust had collected service tax from the appellants on the stevedore charges collected by the latter from cargo owners during the above period. If the impugned demand is enforced, it would amount to double taxation. Certain documents on record indicate that service tax having been collected from the appellants by the Port Trust. It is for the adjudicating authority to examine this evidence and deal with the assessee's plea of double taxation. Pre-deposit waived.

    Stay granted.

  • STO 2009 CESTAT 445
  • Service Tax: Port Service: Liability on the amount of ‘royalty’ received during the period June, 03 to February,06: Scope: Under the licence agreement, the appellant (Port Trust) authorised M/s. SICAL, to render Port Services at the seventh berth to owners of import and export cargo. This arrangement fell under Section 42 (3) of the Major Port Trusts Act. Under this provision read with the definition of ‘Port Services’ given under Section 65 (82) of the Finance Act, 1994. M/s. SICAL has been rendering taxable ‘Port Services’ to cargo owners at the seventh berth who are paying service tax. The payments of royalty by M/s. SICAL to the Port Trust cannot, prima facie, be held to be consideration for any ‘Port Service.’ The grant by the Port Trust to M/s. SICAL under the above agreement is a licence, which, inter alia, includes authorisation to render Port Service under Section 42 of the Major Port Trust Act. For such services, the authorized person has been paying service tax. The case of the Revenue that the royalty received by the Port Trust from M/s. SICAL for the right to use the seventh berth for rendering Port Services to cargo owners should also be brought within the purview of levy of such Port Services prima facie cannot be sustained.(Para 2,3,4).

    Stay granted.

  • STO 2009 CESTAT 173
  • Service Tax: Port services: Repairing of ships: Scope and liability: A strong prima facie case for waiver has been made out in the light of Tribunal’s order in Homa Engineering Works vs. CCE, Mumbai STO 2007 CESTAT 258 which has been followed recently by the Tribunal in the case of Western India Shipyard, holding that the repairing/overhauling ships and other vessels are not port services leviable to service tax.(Para 1).

    Stay granted.

  • STO 2009 CESTAT 167
  • Service Tax: Port services: The activity of ship repairing at the dry dock built by them in an area specified by the Marmugao Port Trust for the period from 16.07.2001 to 31.03.2004: Scope and liability: The issue involved in this case is no longer res Integra. It is squarely covered by the Tribunal's decision in the case of Homa Engineering Works vs CCE, Mumbai reported in . In the said case, after going through the relevant provisions of the Major Port Trust Act, 1963 and the Finance Act, 1994, the Tribunal came to the conclusion that the ship repair service is not the Port Service. It has also been held by the Tribunal, that the Board's Circular No 67/16/2003-ST dated 10.11.2003 clarifying that ship repair activities at the dry docks would be taxable under the port services is not in accordance with the law.(Para 6,7).

    The appellants are not authorized to offer the services on behalf of the port; that they are an independent industrial concern with a factory license and are not a service provider. The only relation that exists between the appellants and the port is that of a licensor and licensee of certain portion of land and water front. The agreement between the appellants and the port is not an "authorization" as required under the statutory definition of port services under Section 65 (82) of the Finance Act, 1994. The appellants are not rendering services as authorized person by port as contemplated and covered in the definition of "port services" by interpreting the words "by the person authorized".(Para 8).

    Appeal allowed.

  • STO 2009 CESTAT 163
  • Service Tax: Port service for the period 1.7.2003 to 31.3.2006: Appellant hired out barges, floating cranes and tugging facilities and received rents for that purpose: Scope and liability: These barges, floating cranes and tugging facilities were hired out by the appellant and was not used by the hirers in the jetty constructed by the appellant, but used somewhere else. In view of this they would not fall under the category of service providers of “port services”. When they applied for the constructions of jetty, the Chief Port Officer of Maharashtra had given them the permission, subject to the conditions that the jetty and infrastructure facilities will have to be made available to the Chief Port Officer, when not in use by the appellants. The lease deed was entered by the appellant with the Maharashtra Maritime Board in respect of water front and seabed for the constructions of captive jetty. The clause in the said lease deed will clearly indicate that as and when it is required these facilities will be made available to the Maharashtra Maritime Board. The hirers who used the barges, floating cranes and tugging facilities paid the port services charges directly to the Maharashtra Maritime Board and what was collected by the appellant was nothing but rent for hiring out these barges, floating cranes and tugging facilities. The issue in this case is squarely covered by the decisions of the Tribunal in the case of Velji P. & Sons (Agencies) P. Ltd. vs. Commissioner of Central Excise, Bhavnagar STO 2007 CESTAT 542 also by the decision of the Tribunal in the case of Homa Engineering Works vs. Commissioner of Central Excise, Mumbai STO 2007 CESTAT 258. Since an identical issue of liability to Service Tax under the head of "port services" for hiring of barges, floating cranes and tugging facilities is already decided by the Division Bench in favour of the assessee, the issue involved in this case is squarely covered in favour of the appellant. Thus the income received as rent charges by the appellant, by hiring out the barges, floating cranes and tugging facilities, would not get covered under the category of the "port services". (Para 2,5,6).

    Appeal allowed.

  • STO 2009 CESTAT 161
  • Service Tax: Port Services: Activity - chipping, painting and repairing of ships and vessels under authorization of Mumbai Port Trust under Dry Dock Licence No. 336 dated 1.7.2004: Scope and liability: The appellants were engaged in chipping, painting etc. in the premises leased out by the Mumbai Port Trust from 16.7.01 to 30.3.2004. It is also undisputed that the appellant has further delegated the work of chipping, painting and repairing of ships and vessels to their various sub-contractors. The activities, which are carried out by the appellant at the premises of the Mumbai Port Trust are repairs and maintenance and as such are not covered by the category of “Port Services”. In an identical issue, in respect of one of their sub-contractors i.e. Homa Engineering Works Vs. CCE, Mumbai-I, the Tribunal, vide its order as reported at (2007) 9 VST 47, has held that these services as rendered by the appellant in that case are not covered under the category “Port Services”. Tribunal in the case of Velji P & Sons (Agencies) Pvt. Ltd. and Another Vs. CCE, Bhavnagar as reported at (2007) 9 VST 372 (CESTAT-Ahd) for the proposition that the Port Services would not included the services rendered by the CHA.(Para 4).

    Ejusdem generis : Admittedly, piloting, hauling, mooring, remooring, hooking, or measuring of vessels are activities which are directly connected with the entry or exit of the vessel from port area. As such, the subsequent expression appearing in the said clause has to be held as covering the services which are in relation to the movement of the vessel and has to be understood and construed by applying the principle of ejusdem generis as held by Hon'ble Supreme Court in case of Sidhdheshwari Cotton Mills (P) Ltd. Vs. UOI reported in 1989 2 SCC 458 = 2002-TIOL-206-SC-CX. The expression ejusdem generis - 'of the same kind or nature' - signifies a principle of construction whereby words in a statute which are otherwise wide but are associated in the text with more limited words are, by implication, given a restricted operation and are limited to matters of the same class or genus as preceding them. If a list or string or family of genus-describing terms are followed by wider or residuary or sweeping up words, then the verbal context and the linguistic implications of the proceedings the words limit the scope of such words. (Para 8).

    Board's Circular No.67/16/2003-ST, dt. 10.11.03, clarifying that ship repair activities at the dry docks would be taxable under the port services. The said clarification, though may be binding on the department officers, is not binding on the assesse. Having held, after examination of the relevant provisions of law that such activity would not be included under the expressions ‘port services’ we hold that above circular issued by Board, is not in accordance with the law.” (Para 8).

    Two coordinate Benches of this Tribunal in an identical set of facts had allowed the appeal of the appellants and very clearly and categorically held that “port services” as defined under Section 65(67) would not cover the services of “chipping, painting and repairs of vessels/ships” undertaken by the current appellant.(Para 10).

    Appeal allowed.

  • STO 2008 CESTAT 235
  • Any transportation of export cargo upto the port area from any place outside the port area might not get covered under the definition of ‘port services’ even though such activity could, remotely, be found to be ancillary to stevedoring.: Any activity performed outside port area would not get covered by ‘port services’ as defined under the Act. It appears that the service tax paid on the gross amount charged for the above transportation, by the assessee, has been adjusted against the demand raised in the show-cause notice. It is seen that service tax was paid on the above activity only to the extent of 25% of amount of abatement allowed under a notification. It appears, the gross amount of transportation charges incurred for the transportation of cargo outside port area should be excluded from the value of taxable service for ‘port services’. Appellants directed to deposit Rs.25,00,000/- Stay partly granted. (para 2).

  • STO 2008 CESTAT 118
  • Custom House Agent Service : Appellants providing Customs House Agent service to their clients. In the case of Customs House Agent service, the assessee mostly undertakes to transport goods meant for export to the customs station or from customs station to the importers premises. The stevedoring activity is loading and unloading of cargo. This activity rendered by the appellant on his own behalf. Transportation charges are clearly reimbursable from their customers and they have to be necessarily excluded from the amount received from their customers.

  • STO 2008 CESTAT 89
  • Stay: Port Services: The substantive issue is whether the activity undertaken by the assessee in Tuticorin & Chennai ports during the material period 16-7-2001 to 31-8-2005 is exigible to service tax in the category of “Port Services” On identical issue, this Bench has granted waiver and stay to certain other assessees and has also posted such cases for final hearing. The assessee has also challenged the above demands on the ground of limitation as the relevant SCN did not raise the requisite ground for invoking the proviso to Section 73(1) of the Finance Act, 1994.  Also taking into account the payment already made by the party waiver and stay of recovery in respect of penalty amounts granted.

  • STO 2007 CESTAT 1423
  • Stay : Prima facie appellants have discharged certain amount of service tax. The balance amount is under contest. They are also relying on the ruling of the Tribunal. Prima facie the appellants are supported by the judgment cited by them. Therefore, the stay application is allowed granting waiver of pre-deposit and staying its recovery.

  • STO 2007 CESTAT 1065
  • Stay: Port Service: The repairs and maintenance of ocean vessels done in the port premises could not be treated as ‘port services’ defined under Section 65 of the Finance Act, 1994  Repair of vessel to be treated as ‘port service’ only if the work is done either by the port or by a person authorized by them.  Full waiver granted.

  • STO 2007 CESTAT 1066
  • Stay: Ship repair services done at the Port were held not to be covered under the category of Port Services. Prima facie case made out. Full waiver granted.

  • STO 2007 CESTAT 912
  • Port Services: Railway siding charges are received from the Railways by the appellant towards utilization of the Port Railway Yard on which Railway sidings has been constructed. The Railways collect these charges on behalf of the appellant and pay it to them. It cannot be said that the Railway siding charges have been received for Port services rendered by the appellants.

  • STO 2007 CESTAT 542
  • Port Services: 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. Not covered under Port Services.

  • STO 2007 CESTAT 550
  • Service Tax: Port services: Scope and liability: Period of limitation: If they are held to be other port, the services rendered by them in so far as hiring of tugs and barges for which hiring income is received would be covered under the definition of port services as their services prima facie relate to goods and vessels. However, on the plea of limitation there is substance for the reason that from December, 2004 onwards, CERA audit objection was raised to the effect that the services rendered by them fall under the scope of port services and income received by hiring of tugs and barges is liable to Service tax and hence prima facie the applicants cannot be held to be guilty of suppression so as to invoke the extended period of limitation after 2004.(Para 4).

    Partial pre-deposit ordered.

  • STO 2007 CESTAT 555
  • Service Tax: Liability on the sub-contractor when principal contractor paid tax liability: Double taxation: There can be no demand on the appellants (sub-contractors) when Service Tax on the same services has been demanded from the main parties. In this connection, the department issued clarifications reported in 2003 (158) E.L.T. (T.33). The clarification was on the question whether a sub-contractor was supposed to take out a registration and discharge tax liability if there was a total sub-contract of the service. The clarification was to the effect that the sub-contractor was not liable to take a registration and that Service Tax, in such cases should be paid by the main service provider. Appellants relied on the Tribunal's decision in Semac Pvt. Ltd. v. Commissioner of Service Tax, Bangalore STO 2006 CESTAT 714, wherein it was held, in respect of "Consulting Engineer's Service", that a sub-contractor/sub-consultant was not required to discharge Service Tax where the main consultant discharged the liability.(Para 3). It requires to be ascertained as to whether the main part of the demand of Service tax raised on the appellants by the Commissioner is a double taxation vis-a-vis demands raised against M/s. South India Corporation Ltd. and other stevedore agents inasmuch as learned Commissioner himself has acknowledged the fact that the appellants were working as sub-contractors of these agencies. If the plea of double taxation will be established by the appellants, they will be entitled to remand of the case to the Commissioner.(Para 4).

    Pre-deposit waived.

  • STO 2007 CESTAT 258
  • Port Service: Ship breaking activities and ship manufacturing activities may also be done in the port area, for which purposes facility may be provided by the port, but that will not make the same as "port services".

    Maintenance or Repair Service: The appellant had taken registration for the said services and had started paying duty thereafter. Revenue has not raised any objection to the said registration of the appellant and payment of duty by them under the category of maintenance and repair services. If the services being rendered by them were already covered by the above services, there was no justification on the part of Revenue to accept their registration under the category of maintenance and repair of services. The said category having been created w.e.f. 1-7-03, the said activity for the past period cannot be held to be covered under the category of port services.

    Limitation: The period involved is 16-7-01 to 30-9-03, whereas the SCN has been issued on 23-1-04. There are no positive allegation of suppression or any mis-statement on the part of appellant with an intention to evade the duty. The issue involved is bona fide interpretation of provisions of law. Extended period cannot be invoked.

  • STO 2007 CESTAT 582
  • Stay: Port Services: The stevedoring activities were activities performed subsequent to unloading of cargo from vessel onto dock. Clearly these are activities ancillary to the main activity undertaken by the Port Trust and, therefore, prima facie, the licence issued by the Port Trust to the appellants should he held to be ore authorising "port services" taxable under Section 65 of the Finance Act, 1994. Prima facie case not made out.

  • STO 2006 CESTAT 601
  • Port Service: Stay: Demand confirmed on accruals which was not received from Railways by the appellants who were authorized to work in the port and had authorized Railways to collect Railway Siding Charges. The applicants had paid service tax on railway siding charges received by them. Their being strong legal contentions raised. Waiver granted.

  • STO 2005 CESTAT 76
  • Stay: Port Services: The consideration for repairing of the vessel has been given to the appellants not in terms of the tariff rates, but the same are result of contract entered by way of negotiations. Prima facie case made out. Stay granted unconditionally.

     
     

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