2012 (11) TMI 444 - AT - Service Tax

Refund of Terminal Handling Charges (THC) and the GTA service alleged that appellant has filed the claim, classifying the Terminal Handling Charges under Port service defined under Section 65(105)(zn) & Section 65(105)(zzl) whereas the terminal handling charges was specified as exempted service vide Notification No. 17/2009-S.T Held that - Notification No. 17/2009-S.T., specifies that payment of service tax on services commonly known as terminal handling charges classifiable under any sub-clause of clause (105) of Section 65 is exempted from service tax - tax paid on terminal handling charges covered under any of the taxable services is refundable - refund of transport of goods under Section 65(105)(zzp) is rejected and to that extent the impugned OIO is upheld.

Summary

Issues involved:
Refund claim of service tax paid on goods transport agency service and handling charges at port under the Central Excise Tariff Act, 1985.

Analysis:
The appeal was filed by the Commissioner of Central Excise, Ahmedabad-II concerning M/s. Sagar Drugs & Pharmaceuticals' refund claim of Rs. 12,931 for service tax paid on services of goods transport agency service and handling charges at the port. The original adjudicating authority sanctioned a refund of Rs. 5,606 for custom house agent service but rejected Rs. 3,919 for GTA service. The respondent filed a memorandum of cross objection, arguing that TMC charges fall under port service and should be eligible for a refund. However, it was found that terminal handling charges are classified under "business auxiliary service" and are not covered under the exemption notification. The notification did not specify these services as eligible for refund during the relevant period from April 2009 to June 2009.

Regarding container handling charges, the Commissioner (Appeals) held that they are covered under port services and eligible for refund as port services were exempted under Notification No. 41/2007-S.T. The judgment agreed with the Commissioner (Appeals) that terminal handling charges were not eligible for a refund as they were exempted under Notification No. 17/2009-S.T. from July 7, 2009, onwards. The notification specified that service tax on terminal handling charges under any sub-clause of Section 65(105) is exempted, making the tax paid on such charges refundable. The refund claim for transport of goods under Section 65(105)(zzp) was rejected, upholding the impugned order.

In conclusion, the judgment rejected the appeal filed by the Revenue and upheld the order of the Commissioner (Appeals) without finding any infirmity in the decision. The pronouncement was made in court on December 15, 2011.