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TMI Blog2015 (11) TMI 51X X X X Extracts X X X X X X X X Extracts X X X X ..... March 2013. 3. After hearing both sides in detail, we consider it appropriate that we discuss each issue in relation to the different demands and give the conclusion under that particular issue. 4. Service tax demand of Rs. 5,88,35,509/-: According to the agreement signed between Government of Andhra Pradesh (GOAP) dated 19.3.1999 with the appellants, appellant became a concessionaire for four shore connected berths at Kakinada Port and the revenue was to be shared between GOAP and the appellants. According to Clause (3) of the agreement, appellants were given permission to build and operate existing berths as well as develop and operate additional berths, to perform related operational, maintenance and management of common facilities. Clause 2.25 of the agreement defines premises given on lease which includes land, all structures and facilities constructed, land reclaimed by the appellant and all facilities and structures constructed or provided by the appellants, etc. The appellants collect the revenue for the port services rendered by them and handover the share of the GOAP. There is no dispute on the fact nor is there any finding to the contrary that GOAP has discharged serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... after 1.7.2012, it is the submission of the appellant that entire demand cannot be sustained. 4.2 Prima facie, we find that this is so. Nevertheless the fact remains that in the show-cause notice the introduction of negative list, Notification No.30/2012-ST dated 20.6.2012 introducing reverse charge mechanism were all mentioned. Moreover, the definition of support service and the definition of Business Support Service prior to 1.7.2012 covered the activity of the appellants. Both the definitions are reproduced for better appreciation. 'Support Services of Business or Commerce' means services provided in relation to business or commerce and includes evaluation of prospective customers, telemarketing, processing of purchase orders and fulfilment services, information and tracking of delivery schedules, managing distribution and logistics, customer relationship management services, accounting and processing of transactions, operational assistance for marketing, formulation of customer service and pricing policies, infrastructural support services and other transaction processing. Explanation 'For the purposes of this clause, the expression infrastructural support service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion as we have mentioned that GOAP has provided infrastructural support. As regards this demand, it has arisen because of the introduction of reverse charge mechanism w.e.f. 1.7.2012 and but for this, the demand itself would not have arisen since payment of service tax by GOAP would be in accordance with law. 4.4 The second ground taken by the appellant is that on the same service, tax cannot be demanded twice. In this case GOAP has paid the tax and in fact tax has been reimbursed by the appellant. Apparently in the initial period of introduction of negative list and the amendment of Finance Act, both GOAP and the appellant did not take note of the provisions and consequently GOAP continued to pay tax. The question that arises is whether in a situation like this where service provider viz., GOAP has paid the tax even though not liable to pay the same can again be demanded from the appellant. Since taxable event is one and the same, there cannot be levy of service tax twice. Therefore we find ourselves in agreement with the submission that once the service provider has paid the tax under reverse charge mechanism, service tax cannot be demanded from the appellant. Nevertheless it ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dit would have been taken only on the basis of challan and in such a case payment would have been made by the appellant themselves. Therefore if the challan contains all the details which are mentioned by the appellant before us, in our opinion, credit is admissible. Therefore the demand for more than Rs. 7.54 crores being the CENVAT credit cannot be sustained. 6. Demand of CENVAT credit of Rs. 6,60,545/-: This amount relates to the credit taken on health service, insurance and motor vehicles, rent-a-cab service, works contract service and services in relation to 7th berth. 6.1 It was submitted that health care with ambulance facility would be available within the port area and this being a mandatory requirement, the appellant tied up with Apollo Hospital, Kakinada. We find that provision of health care within the port area where accident can take place cannot be said to be having no nexus to the port service, therefore the credit of Rs. 83,430/- is admissible. 6.2 As regards insurance, it is submitted that it is a mandatory obligation to insure all vehicles used within the port area in relation to port services. We agree that credit is admissible and therefore held that amount ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome substance in this regard. If 7th berth does not become operational, naturally the issue as to whether CENVAT credit is admissible when the project is dropped would arise. At this stage, it may be premature to deny the credit. 9. Denial of CENVAT credit of Rs. 8,82,646/-. The amount of credit has been denied on the ground that L & T Ramboll Consulting Engineers who rendered the service were not liable to pay service tax in view of the exemption Notification No.38/2010-ST on 28.6.2010. 9.1 It was submitted that the Notification was no longer in existence when the appellants availed the credit; the activities of the service provider were apparently found to be not eligible for exemption and thirdly for the appellant it was an input service. 9.2 We find that it is settled law that whether a service was liable to tax or not or is eligible for exemption cannot be determined by the receiver of service. What is required to be examined at the receiver's end is only the question as to whether the receiver of service had received the service; utilized the service for providing output service; had maintained proper records and the documents were in accordance with law and had paid the t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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