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TMI Blog2016 (10) TMI 878X X X X Extracts X X X X X X X X Extracts X X X X ..... of minerals. This fact is already admitted by the assessee in their written submissions, wherein they have opined that it is ONGC who are conducting survey operations. However, the activities conducted by the assessee even in isolation depict that are being carried out in the direction related to location or exploration of minerals. It is also matter of fact and evidence that shot hole drilling is an activity per se without which the activity of further surveying in relation to a location or exploration of minerals would not be possible. The further activity of using explosives for the said purpose would not be achievable without the drilling of specified and technically drilled holes. Thus, it is materially evident that such holes are basically meant for withstanding the shots and involve several processes for the entire activity of blasting shot to be made possible. Such entire process is undertaken by the assessee by drilling the shot holes, which are technically highly important, based on sound technology and expertise. Thus, in the entirety of the issue, it is also observed that the purposes conducted by the assessee and by their clients the processes are inter-linked, inter-d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pellants were to undertake shot hole drilling activity for ONGC. The appellants were registered with the Service Tax Department for payment of service tax under various categories of taxable services. An audit of the records of the appellant was conducted in October 2007 by the officers of Service Tax, Delhi. As a follow up, detailed enquiries were made regarding the liability of the appellant for service tax in respect of various activities undertaken by them. On completion of scrutiny, proceedings were initiated against the appellant by issue of show cause notice dated 30/5/2008. The show cause notice proposed demand of service tax of ₹ 43,82,72,086/-. The notice also proposed imposition of various penalties and collection of interest on service tax not paid. After due process, the Commissioner adjudicated the case, vide the impugned order he held that the appellants are liable to pay total service tax of ₹ 29,98,68,625/- he also imposed penalty of ₹ 27,47,65,531/- under Section 78 of Finance Act, 1994 and penalty on per day basis in terms of Section 76 of the Act and also ₹ 1,000/- as penalty under Section 77 of the Act. 2. In the present appeal out of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... extended period, the learned AR submitted that the appellants had similar contract with Oil India Limited (OIL) and also have been discharged tax on the activity. However, they have stopped later the payment of tax and in respect of present contracts also they have not discharged tax. In such circumstances, it is very clear that the appellants took deliberate action not to pay tax. They have not made any reference in this regard to the Department or to their main contractor to ascertain the tax liability before actually stopping payment in OIL contract. 4. We have heard both the sides. Though the proceedings were for tax liability on various activities during the submission before us, the appellant is only pressing for and contesting the tax liability on their activity of shot hole drilling under the category of survey and exploration of minerals . The statutory definition relevant to the present case is as below :- Section 65 (104a) of the Act and Section 65 (105) (zzv) of the Act read as under : Section 65 (104a) of the Act Survey and exploration of minerals means geological, geophysical or other prospecting, surface or sub-surface surveying or map making serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eters width and 2.5 meters height. The Appellant has to maintain liaison with the local people and agencies in the survey areas in order to ensure safe and uninterrupted seismic operations . 5. The contention of the appellant is that they are not in the business of survey and exploration of minerals. The Department is holding that the services as explained above rendered by the appellant is very much in relation to survey and exploration of minerals. We note that the appellants are emphasizing on the legal definition of scope of service in terms of Section 65 (104a) and argued that when the appellants are not engaged in such activity, the definition of taxable service in terms of Section 65 (105) (zzv) cannot expand the scope to bring in all types of activities even remotely connected only on the pretext that these are in in relation to survey and exploration of minerals. In other words, the appellants submitted that the term in relation to cannot be given a scope to indefinitely expand the main tax entry of survey and exploration of minerals. We find that the arguments of the appellant in this context is mis-placed. From the very nature of the work undertaken by them it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ploration of minerals. It is also matter of fact and evidence that shot hole drilling is an activity per se without which the activity of further surveying in relation to a location or exploration of minerals would not be possible. The further activity of using explosives for the said purpose would not be achievable without the drilling of specified and technically drilled holes. Thus, it is materially evident that such holes are basically meant for withstanding the shots and involve several processes for the entire activity of blasting shot to be made possible. Such entire process is undertaken by the assessee by drilling the shot holes, which are technically highly important, based on sound technology and expertise. Thus, in the entirety of the issue, it is also observed that the purposes conducted by the assessee and by their clients the processes are inter-linked, inter-depended and inter-related which are in relation to to the location or exploration of minerals. Hence, it is not the issue of mere drilling of a hole, rather involves several process for the said purpose and are not ordinary holes . 7. The dictionary meaning and case laws relied upon by the appellants ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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