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TMI Blog2017 (9) TMI 1384X X X X Extracts X X X X X X X X Extracts X X X X ..... ude some manner of loading and unloading of the goods. It is further seen that the assessee themselves do not carry out even these peripheral activities of loading or unloading. The same is carried out instead by independent contractors. Throughout this exercise due carrier charges are collected by the appellants from the clients to defray the cost of carting and x-ray of cargo paid to third parties. This is just a reimbursement of convenience for all parties involved to ensure seamless, prompt and timely services to the clients. The activities of the assessee herein would definitely fall within the ambit of the said service, namely, "Transportation of Goods by Air" introduced w.e.f 10.09.2004. However, for the prior period (16.08.2002 to 09.09.2004), the department is seeking to bring the same activities under the fold of cargo handling service. This, in our considered opinion, is not just or fair. Law is well settled that when a new entry is brought under the levy of service tax, the same activity cannot be subjected to levy under an existing entry, unless the new entry has been specifically carved out of the earlier one. This is certainly not the case here. In a recent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as proposed in the show-cause notice. 3. In appeal, ld. Commissioner (Appeals) concurred with the adjudicating authority but in terms of para-5.2 he did not propose penalty with the observation that there was no intention to cause evasion. While holding so, in para-15 he held that extended period was not invokable. In para 15 (b) (iii) of his order, he held that the service tax demand is confined to cargo handling service aspect only and the rest of the services provided as alleged in the SCN shall not be exigible to service tax. He held in his order that the appellant was not liable to service tax on valuation charges, airway bill charges, due carrier charges, charges collect fees and demurrage charges which shall not form part of the assessable value. The reasoning he assigned was that such charges are not connected to and are not in relation to cargo handling service. He further held that the amount liable to service tax should be limited to Due carrier charges provided and shown separately and contractors cannot be held liable for the same. Therefore, he required re-quantification of the demand. All these aspects are coming from para-5.2 of the appellate order. 4. Being a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etc. It is therefore not a cargo handler and not providing cargo handling service. 6.3 Placing the Board s Circular No. 80/2004 dated 17.09.2004 [Ref.: Exhibit H at page 75 of the appeal folder] learned advocate says that the service provided for export of cargo is out of the ambit of Service Tax, once that was clarified by the Board as per the provisions made in Finance Bill, 2004. 6.4 Learned advocate further relies on the decision of the Mumbai Bench of the Tribunal in the case of United Shippers Ltd. Vs. CCE, Thane 2015 (37) STR 1043 (Tri.-Mum.) to reiterate their stand that the assessee acted as a mere transporter of the passenger baggage and was not a cargo handling service provider. He also submitted that the lateral entry enacted in law imply that the earlier entry of cargo handling was not covering the scope of the lateral entry. Therefore the assessee should not be brought into the scope of tax by any stretch of imagination. The decision of the Bombay Bench in favour of the assessee was affirmed by the Apex Court as reported in 2015 (39) STR J369 (S.C.) 7. On behalf of Revenue, Ld. DR submits that the ld. Commissioner (Appeals) has made a thorough enquiry of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sporter would be subject to service tax under Cargo Handling Services. Assessee also points out that loading and unloading was done by independent contractors and they have themselves not neither undertaken nor performed the activity of loading or unloading. 8.4 From the definition of Cargo Handling Service , what emerges is that mere transportation of cargo is excluded from that definition. Every activity of service of transportation of goods will surely include some manner of loading and unloading of the goods. The question to be asked is whether such loading/unloading is the primary activity involved in the services carried out. From the facts of the matter at hand, we find that the answer is in the negative. 8.5 It is further seen that the assessee themselves do not carry out even these peripheral activities of loading or unloading. The same is carried out instead by independent contractors. Throughout this exercise due carrier charges are collected by the appellants from the clients to defray the cost of carting and x-ray of cargo paid to third parties. This is just a reimbursement of convenience for all parties involved to ensure seamless, prompt and timely services to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g service is that those of packing, unpacking, loading and unloading of goods. The circular further clarifies that mere transportation of goods is not covered in the category of 'cargo handling' and is therefore not liable to service tax. 8.9 Viewed in this light, the transportation of goods by air will firstly not be taxable under cargo handling service and secondly said activity would attract service tax levy only from 10.09.2004, and that too under Transport of Goods by Air . This being so, we are of the considered opinion that the demand of service tax on the assessee under cargo handling therefore does not have legal basis and will therefore have to be set aside. 9.1 Having arrived at these conclusions, we find further sustenance in the ratio of the following decisions: 9.2 In the case of Jet Airways (India) Ltd. Vs CST, Ahmedabad reported at 2008 (11) S.T.R.645 (Tri.-Ahmd.), it was held as under: After hearing both sides, we find that the appellant is admittedly an Airline engaged in the business of transportation of passenger and cargo. .For the said purpose, the appellant takes booking of the cargo which is to be transported either by himself at its book ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or rendering cargo handling services but is for transportation of the appellant s cargo by air for which purpose, they may get cargo collected or delivered at the customer in which case services have to be held as an integral part of the transportation services. In fact, the independent contractor stands appointed by the appellants for handling cargo and therefore, their services are being availed by the appellants. We find from the above order of the Deputy Commissioner that 24 agents stand appointed by the appellants through which cargo is booked and all the charges are collected by the said agent, who deduct their commission and pay the balance to the appellant. The said finding of fact does not stand rebutted by the Revenue. It is also seen that where cargo is directly booked by the airline, they collect charges from the customer directly. It stands correctly held by the Deputy Commissioner that such services cannot be held to be cargo handling services. As rightly observed by the Deputy Commissioner, the primary duty of every transport operator i.e. road, rail or airport to provide facilities of packing/unpacking, loading/unloading of goods to the customer for promotion of bus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r transportation of the cargo from one place to another cannot be covered under the category of cargo handling service. If the said services are held to be cargo handling or any trader or shopkeeper who is mainly engaged in the same product may also undertake to the bought out items the same at the customer door step would be held as cargo handling agents. We also agree with the appellant s contention that once the new entry is introduced with effect from the date without disturbing already existing entries, it has to be held that the new entry was not covered by the previous entry. The reference in this regard is made to the Tribunal decision in the case of Board of Control For Cricket in India v. C.S.T., Mumbai - 2007 (7) S.T.R. 384 (Tri.- Mumbai). 9.3 The above decision was followed in the case of Jet Airways (India) Pvt. Ltd., Vs Commissioner of Central Excise, Hyderabad reported in 2010 (17)S.T.R. 94 (Tri.-Bang.). 9.4 In a recent decision, in the case of United Shippers Ltd. Vs Commissioner of Central Excise, Thane-II reported in 2015 (37) S.T.R. 1043 (Tri.-Mumbai)the ratio of the Jet Airways decision, cited supra was relied upon by the Tribunal to hold that trans ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cordingly, the Civil Appeals are dismissed. 9.6 In the case of Jet Airways (India) Ltd. Vs Commissioner of Service Tax, Ahmedabad reported in 2008 (11) S.T.R. 645 (Tri.-Ahmd.), the Tribunal has held that mere transportation is not covered under Cargo Handling Service. The relevant portion of the order is mentioned para 4 as follows:- After hearing both sides, we find that the appellant is admittedly an Airline engaged in the business of transportation of passenger and cargo. .For the said purpose, the appellant takes booking of the cargo which is to be transported either by himself at its booking office or through IATA agents appointed at various locations all over the country. The cargo booked by the cargo agents are directly transported by the cargo agents to the warehouse at the Airport for uplift to the destination through the Airlines of the appellants. The loading/unloading activity is done by M/s. Philipson Corporation in terms of agreement entered into between the two. The cargo which is unloaded at the destination is transported to warehouse of the appellant and the consignee/agent of the consignor collect the cargo from the warehouse of the appellant. The appell ..... X X X X Extracts X X X X X X X X Extracts X X X X
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