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Issues involved: Revenue seeking stay of operation of OIA No. 174/2006-CE dated 9-6-2006, classification of services as "Port Services" or "Cargo Handling Services", interpretation of Board's Circular.
The Revenue sought stay of the operation of OIA No. 174/2006-CE dated 9-6-2006, contending that the services of the assessee of "Steamer Agent Services" should be classified as 'Port Services'. The respondent argued that they were solely handling cargo and not providing 'Port Services', further asserting that they should not be categorized under Cargo Handling Services due to their exclusive handling of export cargo, which is excluded from the definition of Cargo Handling Services. The Commissioner (Appeals) accepted the respondent's argument, set aside the OIO rejecting the refund, and directed the refund of amounts paid by the assessee, citing that the Board's Circular contradicted the definitions of services in the Finance Act and was not followed. The Revenue challenged the Commissioner (Appeals)'s order, contending that the Board's Circular should have been adhered to, and that the activity carried out by the assessee falls within the scope of Port Services, thus the Board's clarification should have been applied. After hearing the arguments of the JDR and the Counsels, it was noted that the appellants were handling export cargo, not import cargo, and as per the definition, the handling of export goods is excluded from Cargo Handling Services. Therefore, the Commissioner (Appeals) was deemed correct in determining that the respondent cannot be classified under Cargo Handling Services or Port Services. The findings that the Board's Circular did not align with the definitions appeared prima facie correct, leading to the rejection of the stay application by the Revenue. The appeal was scheduled to be heard in due course.
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