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TMI Blog2023 (4) TMI 1325X X X X Extracts X X X X X X X X Extracts X X X X ..... , Sea-road etc., which appeared to be classifiable under "Cargo Handling Service" on full value till 14.11.2009. It further appeared that in the case of handling & transporting of goods by multi-modes, Appellant had provided various services like loading/ unloading/ stacking of the goods at respective rail or port yard, road transportation from plant to rail/ port head, transportation of goods by rail or sea and from destination rail/ port head to M/s Essar Steel Ltd. various depots /stock -points/ job-workers‟ premises and accordingly charged composite rate per MT basis depending on various destination. Thus, it was alleged that looking to the scope of works, the aforesaid services appear to be classifiable under the category of "Cargo Handling Service" and accordingly service tax should have been discharged on entire amounts charged by them towards aforesaid service. However till 14.11.2009 Appellant had raised tax invoices bifurcating composite rate into different components like (a) transport transportation component (b) port services components in case of transportation by sea or cargo handling services component in case of transportation by rail and (C) rail freight or ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had charged a single composite rate of freight mutually agreed for transportation of goods by road as well as other multiple modes of transportation and however had bifurcated the same into different service components. Despite coming to the conclusion that Appellant had rendered transportation service, Learned Commissioner yet upheld the demand under the head of Cargo Handling Service which is clearly untenable. 3.1 He also submits that during the material period, Appellant rendered only Transportation services and in respect of these services, it cannot be called upon to discharge service tax under the head Cargo Handling Services. The Appellant has not rendered any handling services whatsoever insofar while discharging transportation service. The definition of Cargo Handling Service specifically excludes mere transportation of goods from the ambit of Cargo Handling Services. Therefore, the service of mere transportation, as provided in the present case cannot be categorized under the head of Cargo Handling Service. Since Transportation is the main element of the services provided by the Appellant, the handling of the cargo, if any, was incidental to the transportation service, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ircraft. 3.3 Without prejudice, he further submits that the show cause notice sought to levy service tax under the head of Cargo Handling Service on total amount charged by the appellant towards transportation of goods by Road, Sea transportation, rail transportation and other handling expenses incurred during such transportation. Whereas, the impugned order concluded in para 17.7 that insofar as transportation by road was concerned, there were no other services of loading, unloading, handling, etc., which was rendered by the appellant and that service that on the transportation services was rightly so discharged by M/s Essar Steel Ltd. In paras 17.09 and 17.10. it is recorded by the Learned Commissioner that the Appellant had not discharged service tax on the sea freight component or the rail freight component. Thereafter in para 17.14., 17,31, 17.8, the Learned Commissioner has concluded that the service of handling and transportation of goods by sea and rail were not transportation service but were classifiable under the head of Cargo Handling Services. Despite not accepting the case as made out in the show cause notice, the impugned order still confirms the entire service tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inance Act, 1994. He placed reliance on the case of CCE Vs. BSBK Pvt. Ltd. 2010(18)STR 555. 3.7 Without prejudice he also submits the even if one is to assume that the service in question are liable to tax under the head Cargo Handling Service, than in respect of the amount shown separately towards transportation, there can be no liability towards Service tax as has been clarified by the Board in Circular F.No.11/1/2002-TRU dated 01.08.2002. As clarified in this circular, in a case where the Bill indicates separately the amount charged for cargo handling and the amount charged for transportation, then service tax is leviable only on the cargo handling charges. 3.8 He further submits that in para 17.21. of the impugned order, Learned Commissioner has referred to the view taken by the Appellant in its letter dated 18.11.2009 where it proposed to classify the multi modal transport activity in the category of Cargo Handling Service after 14.11.2009 and held that if that was the Appellant's view, it could not classify the different activities differently even for the earlier period. However this proposed to classify the services rendered by it post 15.11.2009 differently in view of it ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... id services. 3.10 He also argued that Learned Commissioner has also erred in solely relying upon the forced deposition of Appellant's Chief Executive Officer Mr. Himatsingka. The testimony was not tested in cross examination and will fall short of reliable evidence. 3.11 He further argued that in terms of the proviso to Section 73 of the Finance Act, 1994 the extended period can only be invoked in case of fraud, collusion, willful misstatement, suppression of facts or contravention of any of the provisions with intent to evade payment of Service tax. None of these ingredients are available in the present case nor has the department produced any evidence to substantiate the same. Appellant in a bona fide manner believed that not service tax was payable on the portion attributable to sea freight and rail freight and therefore it is not the case where the assessee deliberately did not pay Service tax. Further Service recipient were also eligible to avail credit, and therefore the entire dispute is revenue neutral and as such the extended period could not have been invoked. The jurisdictional Service tax authority had approved the return filed by the Appellant from time to time and i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to cargo handling services." From the definitions given above, it is clear that loading, unloading, handling of cargo for all modes of transport and any other service incidental to freight would be covered by the definition of "cargo handling". The definition also very clearly specifies that mere transportation of goods will not be considered as cargo handling service. The definition itself clarifies that if the activity is only of transportation, then the said activity cannot be called as cargo handling service.Regarding the Appellant's liability to service tax under the category of "Cargo Handling Services" it is seen that the Learned Commissioner in para 17.6 of the impugned order itself admitted the facts that Appellant have been awarded the contract by M/s ESL for movement of goods from their various premises to their various depots as well as job- workers premises by road, rail and sea modes and accordingly appellant charged composite rate per MT basis depending on various destination. The said facts itself prove that the essence of the contract is transportation of goods from one place to other place via road/rail/sea modes. We note that a similar issue came up for decisio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the facts that the main work of Appellant during the disputed period was transportation of goods and further in the present matter there was no element of packing involved. We also noticed that the Learned Commissioner in impugned order in para 17.7 held as under: " 17.7 I find that in case of goods transportation of road, M/s ELL were providing merely transportation services as other services like loading/unloading etc. was being handled and managed by M/s ESL by themselves and therefore M/s ELL have raised invoices indicating the value of freight charged per MT depending upon various destinations as fixed by contract under the category of "Transportation of Goods by Road" services and also indicating the "person liable to pay services tax" in such cases as M/s ESL, with computation of Service tax on abated value." The above finding of Learned Commissioner itself shows that the Appellant's activity is not covered under the "Cargo Handling Service. From the above observation we hold that the services rendered by the appellant did not qualify to the definition as Cargo Handling Service. 5.3 We also find that Learned Commissioner in the present matter also confirmed the service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... classify the different activity under one composite head "Cargo Handling Service" after 15.11.2009, the Jurisdictional Service tax authorities themselves vide letter dated 25.03.2010 objected the idea of having composite service category as proposed by the Appellant and advised the appellant to pay service tax on different activities classifying them under different heads. Thus even according to the revenue, the services rendered by the appellant cannot be classified under Cargo handling Service. All these factors show that there was confusion on the part of the officers also as regards the correct scope of the services being provided by the appellant. As such, we are of the view that the non -levy, if any, is not on account of a mala fide intention on the part of the appellant and no suppression or misstatement with an intent to evade service tax can be attributed to the appellant. As such, we are of the view that the demand is also hit being barred by limitation. 06. In view of our above discussion and finding, the impugned order is not sustainable, hence, we set aside the impugned order and allow the appeal with consequential relief if any, as per law. ( Pronounced in the ope ..... X X X X Extracts X X X X X X X X Extracts X X X X
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