2018 (9) TMI 581 - AT - Service Tax

Valuation - inclusion of value of loading agreement into the value of mining agreement - Revenue has been of the view that the appellants are not paying service tax properly as the service value of both loading agreements and transportation agreement need to be included into the mining services value. Held that - The matter is no-longer res-integra in view of the decision of Hon ble Supreme Court in Singh Transporters 2017 (7) TMI 494 - SUPREME COURT for the demand period between 01/04/2012 to 31/06/2012 wherein the service akin to the one provided by the appellants to M/s South Eastern Coal Fields Ltd. have been found by Hon ble Supreme Court to be rightly classifiable under transport of goods by road service - demand set aside. So far as the demand from 01/07/2012 to 31/03/2013 is concerned same has also been decided by this Tribunal in its final decision in the case of M/s H.N. Coal Transport Pvt. Ltd. and others vs. CCE & ST Raipur 2018 (8) TMI 173 - CESTAT NEW DELHI in the similar cases where it was held that wherein this Tribunal has found that since the service provided by the appellants within mining area has already been classified by Hon ble Supreme Court in Singh Transporters case even in the post negative regime w.e.f. 01/07/2012 the appellants are entitled for abatement on the value of services provided by them and since the service tax has already been paid by the service recipient after availment of the abatement and therefore no service tax liability remains with the appellant - demand set aside. Appeal allowed - decided in favor of appellant.

Summary

Issues involved:
Interpretation of service tax liability on loading and transportation agreements in the mining sector for the financial year 2012-2013.

Analysis:
The judgment pertains to three appeals with similar facts regarding the payment of service tax by appellants engaged in loading and transportation of coal in a mining area. The dispute revolves around whether the appellants correctly paid service tax by including the value of loading agreement into the mining agreement's value and paying service tax on charges under the transportation agreement. The Revenue contends that service tax should be paid on the total amount received under both agreements. The impugned show cause notices were confirmed by the Commissioner, Raipur, leading to the appeals.

The appellants argued that the issue involves two periods: pre-negative list regime (01/04/2012 to 30/06/2012) and post-negative regime (01/07/2012 to 31/03/2013). They relied on a Supreme Court judgment in the case of CCE & ST, Raipur vs. Singh Transports, which classified services similar to those provided by the appellants under "transport of goods by road service" rather than "mining of mineral, oil or gas service." The appellants claimed entitlement to abatement on services provided post-negative regime, citing a Tribunal decision in the case of H.N. Coal Transport Pvt. Ltd. The Tribunal held that the transportation activity within the mining area falls under goods transport agency service even in the post-negative regime, entitling the appellants to abatement.

The Tribunal found that the matter was settled by the Supreme Court judgment for the pre-negative regime and by its own decision in the H.N. Coal Transport Pvt. Ltd. case for the post-negative regime. Relying on these precedents, the Tribunal set aside the order-in-originals and allowed the appeals, concluding that the appellants were not liable for service tax beyond what had already been paid by the service recipient under the abatement scheme.

In conclusion, the judgment provides clarity on the classification of services in the mining sector for the specified periods, aligning with the Supreme Court's interpretation and Tribunal decisions, thereby relieving the appellants of additional service tax liability.