9911796707
TMI Blog2007 (9) TMI 53X X X X Extracts X X X X X X X X Extracts X X X X ..... the appellants and Smt. Sudha Koka, the learned SDR, for the Revenue. 3. We heard both sides. The appellant is the absolute owner of M/s. Cochin International Airport Ltd. (CIAL in short). Air India has undertaken ground handling services at the airport including transportation of cargo from ramp to the cargo complex. The appellant has also carried out some services. Air India collects and remits Service tax on the gross turnover. 15% of the gross turnover from all Airlines is given to the appellant. It was urged that as the gross receipt of the Airlines had already suffered Service tax, charging Service Tax on the amounts received by the appellant amounts to levying Tax twice on the same amount. The amount received from Air India is calle ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m various parties. She said that in para 24 of the impugned order, the Agreements entered into between the appellant and various parties had been discussed and all the agreements related to the licence granted by the appellant to such parties for performing the functions allotted to each of them. The income received was described as licence fee and not as rentals and, therefore, such income was found to be qualified as taxable income in view of the Circular F. No. 80/10/2004-S.T., dated 17-9-2004. She further stated that the Commissioner has examined the issue thoroughly and passed the impugned order. She prayed for rejecting the Stay application. 3.2 The appellant contended before the Commissioner that the services provided by them could ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the appellant from them. While holding that the royalty is liable to Service tax, the Commissioner has not stated the nature of the service rendered by the appellant in return for royalty from Air India. Thus, the findings lack clarity. According to him, there is also no evidence produced by the appellant to the effect that Air India had already discharged Service tax on the royalty amount paid to the appellant. 3.4 The third point urged by the appellant before the Commissioner was that the licence fee collected by them are only rentals and they are not liable to Service tax in terms of the Circular referred supra. In the Order-in-Original, the Commissioner has referred to the following Agreements entered by the appellant with variou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efore, would not be liable to Service tax. 3.5 On going through the impugned order, we are of the opinion that the entire issue of Service tax liability on royalty and licence fee is debatable. The Agreements entered between the appellant and the various parties have to be thoroughly scrutinized before coming to a proper conclusion. If one goes simply by Ministry's Circular, then, one would conclude that both royalty and licence fee would come under the Service tax net. But such a conclusion may not accord with the law. The appellants have also pleaded financial hardship. Taking into account all these factors, we are of the opinion that the appellants should pre deposit a sum of Rs. 35,00,000/- (Rupees thirty five lakhs only) within a peri ..... X X X X Extracts X X X X X X X X Extracts X X X X
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