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TMI Blog2023 (3) TMI 15X X X X Extracts X X X X X X X X Extracts X X X X ..... . GREATSHIP (INDIA) LTD. VERSUS COMMISSIONER OF SERVICE TAX, OIL AND NATURAL GAS COMPANY LTD. [ 2015 (4) TMI 1006 - BOMBAY HIGH COURT ], where it was held that the said service cannot be said to be a service rendered to the installations, structures and vessels. Not only this, but the Respondent also in the order- in-original has noted that the appellant is discharging applicable service tax on the services received by installations, structures and vessels in the Continental Shelf and Exclusive Economic Zone of India but was not discharging the service tax on services consumed by the seabed of Continental Shelf of India. The territorial application of the service tax and the commencement of its application from 01.07.1994 and the change brought forth in the application w.e.f. 07.07.2009 has been discussed in the case of Reliance Industries Vs Commissioner of Service Tax, LTU Mumbai [ 2014 (1) TMI 257 - CESTAT MUMBAI ], where it was held that Appellant had not provided any service regarding which the appellant had paid service tax on reverse charge mechanism in respect of any service provided or to be provided by or to such installations, structures and vessels or for supp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ea in the continental shelf and exclusive economic zone of India vide Notification No.1/2002 dated 01.03.2002, the appellant is not liable to pay the service tax. The Department has demanded service tax alleging that appellant has received work orders from M/s.BST Management Services, Chennai and M/s.Western India Ship Ltd., Goa which are situated in India. Further that services were provided by one Indian company to another Indian company and that the consideration has been received in Indian rupees. The department has raised the demand by concluding that the activity does not amount to export of services . The appellant has filed detailed reply stating that the maintenance and repair works on rigs/drill ships was carried out outside the territorial application of the Finance Act, 1994 and therefore, the appellant is not liable to pay service tax. The fact that the services were performed in the non-designated area is admitted and accepted in para 3.4 and 3.5 of the SCN as well as in the OIO. The period involved being from February 2007 to July 2008 which is prior to the amendment to Notification No.1/2002 i.e. 07.07.2009, the appellant is not liable to pay service tax for the ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the designated areas in the continental shelf and exclusive economic zone of India In exercise of the powers conferred by clause (a) of sub-section (6) of section 6, and clause (a) of sub-section (7) of section 7, of the Territorial Waters, Continental Shelf, Exclusive Economic Zone and Other Maritime Zones Act, 1976 (80 of 1976), the Central Government hereby extends the provisions Chapter V of the Finance Act (32 of 1994) to the designated areas in the Continental Shelf and Exclusive Economic Zone of India as declared by the Notifications of the Government of India in the Ministry of External Affairs Nos. S. O. 429 (E) dated the 18th July 1986 and S.O. 643 (E), dated the 19th September, 1996 with immediate effect. [ Notification No. 1/2002-Service Tax, dated 1-3-2002 ] 9. It is clear from the above that the provisions of Chapter V of Finance Act, 1994 applies only to designated areas in the continental shelf and exclusive economic zone of India. It is clear from the SCN as well as the OIO that the repair works were performed in the non-designated area of continental shelfs and exclusive economic zone. The provisions of Chapter V of the Finance Act, 1994 can only appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... illing work undertaken in open locations except the service provided to installations, structures and vessels in the Continental Shelf and Exclusive Economic Zone of India for the period between 7-7-2009 to 27-2-2010. . 42 . In view of settled legal position, we find that the 2010 Notification cannot be said to be clarificatory in nature, but it brings about substantive change in law. Whereas the 2002 Notification as amended by 2009 Notification is applicable only to the services rendered to installations, structures and vessels, the 2010 Notification widens the tax scope and amongst various other services also brings into the Service Tax net the services rendered to or by the installations, structures and vessels. It can thus be seen that the present transaction, which is in the nature of providing services by the vessels of the appellant for the purpose of prospecting mineral oil and as such is a service consumed by the seabed of Continental Shelf of India would come in the tax net only after 2010 Notification came into effect. We are of the considered view that the said service cannot be said to be a service rendered to the installations, structures and vessels. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed under the IOS Rules 2006. The Lower Authorities have failed to take note of the fact that till 01.07.2012, the Service Tax Legislation did not apply to the entire CS and EEZ of India, but to only some parts thereof and that it was only with effect from 01.07.2012 that the coverage became wide enough to cover the pre-construction and for construction services rendered anywhere in the CS and EEZ of India. It was submitted that the lower authorities have failed to appreciate that the amendments brought about with effect from 27.02.2010 (by issue of Notification No.14/2010-ST dated 27.02.2010 and Notification No.16/2010-ST dated 27.02.2010) had to be construed contextually in the light of the following legislative history concerning the territorial coverage of the Act. i) With effect from 01.07.1994 (but till 01.03.2002), the provisions of Chapter V of the Finance Act, 1994 did not apply to any area in the CS and EEZ of India. During this period the provisions of the Act applied to the whole of India except the State of Jammu Kashmir . In the absence of a statutory definition of India , the meaning of India in terms of Section 3(28) of the General Clauses Act was required t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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