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TMI Blog2016 (12) TMI 103X X X X Extracts X X X X X X X X Extracts X X X X ..... and we leave the said question open. The demand of 'service tax' made by the respondent is unwarranted and is hereby set aside - appeal allowed - decided against Revenue-respondent. - Civil Appeal No (S). 4066-4067/2015 - - - Dated:- 22-11-2016 - A. K. Sikri And Abhay Manohar Sapre, JJ. For the Appellant : Mr. Prag P. Tripathi, Sr. Adv. Mr. Preetesh Kapoor, Adv. Ms. Hemantika Wahi,Adv. Mr. Kabir Hathi, Adv For the Respondent : Mr. P.K. Mullick, Adv. Mr. Subhash Acharya, Adv. Mr. B. Krishna Prasad, Adv JUDGMENT Heard learned counsel appearing for the parties. These appeals are filed by the appellants which are two Public Sector Undertakings of the State of Gujarat. They were served with show cause notice dated 04.05.2011 alleging therein that the appellant no. 1 (hereinafter referred to as 'GSFC') was collecting 'incineration charges' from M/s. Gujarat Alkalies Chemical Ltd. (hereinafter referred to as 'GACL') and the said amount charged by GSFC from GACL amounted to providing 'Storage and Warehousing Services' falling under clause (zza) of Sub-Section (105) of Section 65 of the Finance Act, 1994. The GSFC submitted its re ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eived is being consumed at 60:40 ratio by GSFC-PU and GACL - Sodium Cyanide Unit. The hold tank is there to sustain continuous process of both the plants and to facilitate smooth operation of the suction pumps and to avoid starvation of the pumps. Starvation of pump is not allowed as it causes damage to the pump and disturb the process. In case of any problem at consumers end, HCN supply from M/s. RIL is stopped, remaining quantity in tank is immediately consumed by either of the plants. The question of storing HCN does not arise because it is not permissible to store HCN on safety ground. The hold tank is duly washed and kept empty for further use. Insofar as 'incineration charges' are concerned, the manner in which GSFC and GACL had agreed to share these charges between themselves was also explained, as can be seen from the following portion of the reply to the show cause notice: H. GACL does not pay to GSFC Polymer Unit and GSFC Polymer Unit does not demand or receive from GACL any fee or charges nor does either of them do any work of perform any service to the other. The sole monetary transaction between them, vide the agreements/Minutes of the Meeting, etc., ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hin four corners of the definition of 'Storage and Warehousing' contained in Sub-Section 102 of Section 65 of the Finance Act, 1994; 2. In order to attract service tax, there has to be an element of service provided by one person to the other for which charges for providing such services are collected. The appellants have argued that insofar as the present case is concerned, none of the aforesaid ingredients is satisfied. As far as the first element, namely 'Storage of HCN', is concerned, referring to the process mentioned in the reply to the show cause notice, which we have already extracted above, it is submitted that the HCN is received through pipeline and as soon as it is received, the same is consumed in the ratio of 60:40 between GSFC and GACL. The holding tank which is described as 'storage tank' for convenient purposes is there only to sustain the continuous process of both the plants and to facilitate smooth operation of suction pumps and to avoid any damage thereto. It is, thus, argued that nothing is stored in the said so-called storage tank and, therefore, this process would not qualify the term 'Storage'. Mr. Parag P. Tripathi, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contained in the order of Adjudicating Authority as well as Appellate Authority and submitted that even in the statements given by the representatives of the GSFC and GACL it was accepted that the supply of HCN by M/s. Reliance Industries Ltd. was first kept in the storage/holding tank and from there it was distributed between GSFC and GACL in the ratio of 60:40 and, therefore, the said storage/holding tank would qualify as storage facilities . It was further submitted that since GSFC was collecting 'incineration charges' from GACL, it was rightly held that the service was provided by GSFC to GACL and, therefore, the provisions of clause (zza) of Sub-Section (105) of Section 65 of the Finance Act, 1994 were clearly attractive. Learned counsel further argued that these were the questions of fact on which all the authorities had arrived at concurrent findings which should not be interfered with by this Court as the scope of the present appeals is only to deal with the substantial question of law. We have considered the aforesaid submissions in the light of the material placed on record. We shall advert to the second aspect namely, as to whether the arrangement between GSF ..... X X X X Extracts X X X X X X X X Extracts X X X X
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