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TMI Blog2024 (12) TMI 1365X X X X Extracts X X X X X X X X Extracts X X X X ..... ices i.e. Goods Transport by Road. It is further noticed from the available records that transportation of limestone is treated as separate service by the appellant and SCL for which consideration is separately agreed between them which is separately charged by the appellant to SCL through its another proprietorship firm namely M/s. Harsidhi Transport. Thus, mining and transportation services are separate services falling under separate specific heading of sub-clauses of sub section (105) of section 65, where transportation of goods by road is classifiable under clause (zzp) of clause (105) w.e.f. 01.01.2005 and the mining services provided in the mines are classifiable under clause (zzzy) of clause (105) of the Finance Act, 1994 and the same therefore cannot be considered as composite service. Conclusion - The transportation services are not part of mining services for VCES purposes. The impugned Order of Commissioner cannot be sustained and is therefore set aside. Appeal allowed. - MR. RAMESH NAIR, MEMBER (JUDICIAL) AND MR. RAJU, MEMBER (TECHNICAL) Shri Rahul Gajera, Advocate, appeared for the Appellant Shri Rajesh Nathan, Assistant Commissioner(AR) appeared for the Respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e correct amount of service tax liability for the period 01.10.2007 to 31.3.2014 comes to Rs. 1,14,44,009/- 1.3 The appellant filed reply and contested the show cause notice mainly on the ground that transportation charges were not included in the declaration as appellant held bonafide view that the said services fall under Goods Transport Agency (GTA) service which is supported by the fact that SCL has regularly paid Service Tax on said value as consignee under Reverse Charge since 2005 and filed ST 3 returns which has been accepted by department from time to time; that service tax paid by SCL on transportation charges cannot be included in the value of mining service as such transportation activity is a separate service falling under the category of transport of goods by road as clarified by CBEC circular dated 12.07.2007; that for the period 01.01.2013 to 31.03.2014, service tax under the mining service is duly discharged, and that show cause notice for such period is beyond the scope of section 111 of the Finance Act, 2013. 1.4 The show cause notice was adjudicated by the Commissioner who confirmed the demand of service tax by the impugned order and hence the present appeal of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tegral to mining activity and are required to be considered composite service in terms of section 65A (2) (b) of the Act, which provides that composite services consisting of a combination of different services which cannot be classified in the manner specified in clause (a) of section 65A(2) shall be classified as if they consisted of a service which gives them their essential character and that CBEC circular dated 12.11.2007 applies for the mining activities under taken for the period prior to 01-06-2007. 4.1 It is the case of department in the show cause notice that the levy of service tax on Mining service was introduced with effect from 01.6.2007 by virtue of Notification No. 23/2007-ST dated 22.05.2007. In that context, CBEC vide Circular F. No. 232/2/2006-CX.4 dated 12.11.2007 issued general guidelines for settlement of pending disputes regarding the applicability of service tax on activities undertaken in mining sector which applied to period prior to the date of circular, the circular is reproduced hereunder: Mining Service Applicability of Service tax on activities undertaken in mining sector before 1-6-2007 C.B.E. C. Letter F. No. 232/2/2006-CX. 4, dated 12-11-2007 Gover ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nce, excavation and earth-moving and demolition service w.e.f. 16-6-2005. 4 . Coal cutting or mineral extraction and lifting them up to the pithead : These activities are essential integral processes and are part of mining operations. As stated earlier, mining activity has been made taxable by legislation under the Finance Act, 2007 (w.e.f. 1-6-2007). Prior to this date, such activities, being part of mining operations itself are not subjected to service tax. Therefore, no service tax is leviable on such activities prior to the said date. 5. Handling and transportation of coal/mineral from pithead to a specified location within the mine/factory or for transportation outside the mine : These activities are post-mining activities and are chargeable to service tax under the relevant taxable services, i.e., Cargo Handling service and Goods Transport by Road . However, in case, such transportation is undertaken by mechanical systems, such as conveyor belt system, ropeway system, merry-go-round systems etc., and the same is not transported by road, no service tax would be chargeable. Service tax is, however, chargeable under cargo handling service, even if the loading, unloading and simi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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