Custom, Excise & Service Tax Tribunal
Kartikay Bulk Movers Pvt. Ltd vs Commissioner Of Central Excise, Nagpur on 20 November, 2013
IN THE CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL WEST ZONAL BENCH AT MUMBAI COURT No. I APPEAL No. ST/164/08 (Arising out of Order-in-Original No. 09/ST/2008/C dated 29.4.2008 passed by Commissioner of Central Excise & Customs, Nagpur) For approval and signature: Honble Mr. S.S. Kang, Vice President Honble Mr. P.K. Jain, Member (Technical) ======================================================
1. Whether Press Reporters may be allowed to see : No the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
2. Whether it should be released under Rule 27 of the :
CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
3. Whether Their Lordships wish to see the fair copy : Seen of the Order?
4. Whether Order is to be circulated to the Departmental : Yes authorities?
====================================================== Kartikay Bulk Movers Pvt. Ltd. Appellant Vs. Commissioner of Central Excise, Nagpur Respondent Appearance: Shri D.H. Nadkarni, Advocate, for appellant Shri V.K. Agarwal, Additional Commissioner (AR), for respondent CORAM: Honble Mr. S.S. Kang, Vice President Honble Mr. P.K. Jain, Member (Technical) Date of Hearing: 20.11.2013 Date of Decision: 20.11.2013 ORDER NO Per: S.S. Kang Heard both sides.
2. The appellant filed this appeal against the adjudication order passed by the Commissioner of Central Excise, whereby a demand of Rs.1,21,66,489/- along with interest is confirmed for the period 1.10.2002 to 30.6.2007 on the ground that the appellant had provided cargo handling service which is liable to service tax. Penalties under Sections 76, 77 and 78 of the Finance Act are also imposed.
3. The contention of the appellants is that the appellants main activity under the work order is in respect of transportation of coal within the mines. The contention is that the work order is for hiring of pay loaders of tippers and transportation of coal from ground store to new CHP of gauges. This activity does not fall under the cargo handling service. As per the definition, cargo handling service means loading, unloading, packing or unpacking of cargo and includes cargo handling service provided for freight in special containers or for non-containerized freight, services provided by a containers freight terminal, or any other freight terminal, for all modes of transport and cargo handling services incidental to freight, but does not include handling of export cargo or passenger baggage or mere transportation of goods. The contention is that the sole activity of the appellants is not of loading, unloading, packing or unpacking of cargo. The main activity of the appellants is for transportation of coal from one place to another place within the mines. The appellants relied upon the following decisions:-
(i) CCE,C&ST, Bhubaneswar-II vs. Vinshree Coal Carriers Pvt. Ltd. reported in 2008 (10) STR 473 (Tri.);
(ii) Avian Overseas Pvt. Ltd. vs. CCE reported in 2009 (15) STR 540 (Tri.);
(iii) Sainik Mining & Allied Services Ltd. vs. CCE reported in 2008 (9) STR 531 (Tri.);
(iv) Singh Transporters vs. CCE, Raipur reported in 2012 (27) STR 488 (Tri.), and
(v) CCE, Ranchi vs. Modi Construction Co. reported in 2011 (23) STR 6 (Jhar.).
The contention of the appellants is that in the above mentioned decisions, the Tribunal as well as the Honble Jharkhand High Court held that the handling of goods within mines/factory premises is not covered under the cargo handling service.
4. The Revenue relied upon the terms and conditions of the work order and submitted that for transportation of goods, the payment should be on kilometer basis. In the present case, the payments are on the basis of quantity of coal which is loaded in the pay loaders of tippers and that quantity is to be shifted to other place. The Revenue relied upon the decision of the Honble Orissa High Court in the case of Coal Carriers vs. CCE&ST, Bhubaneswar reported in 2011 (24) STR 395 (Ori.). The contention is that the Honble High Court, in a similar situation, held that the activity undertaken by the assessee covers under cargo handling service.
5. In reply, the contention of the appellants is that the demand beyond the normal period of limitation is time barred as the allegation with intent to evade payment of tax is not sustainable in view of the earlier decision of the Tribunal, where it has been held that the activity undertaken in the mines does not fall under the scope of cargo handling service. The appellants are under bona fide belief that the activity undertaken by the appellants is not taxable as cargo handling service, therefore the invocation of extended period of limitation is not sustainable.
6. We find that the main contention of the appellants is that the activity does not fall under the taxable service of cargo handling service. For ready reference, the provisions of Section 65(23) of the Finance Act are reproduced below:-
Cargo handling service means loading, unloading, packing or unpacking of cargo and includes cargo handling service provided for freight in special containers or for non-containerized freight, services provided by a containers freight terminal, or any other freight terminal, for all modes of transport and cargo handling services incidental to freight, but does not include handling of export cargo or passenger baggage or mere transportation of goods. The provisions of the above Section are interpreted by the Honble Orissa High Court in the case of Coal Carriers (supra) relied upon by the Revenue. The Honble High Court, after taking into consideration the activity undertaken in the mines, which is similar to the activity undertaken by the appellants, held that the activity such as hiring of pay loaders for mechanical transfer of coal within the mining area comes under the scope of taxable service of cargo handling service. The Honble High Court also confirmed the demand which was confirmed by invoking extended period of limitation, where the assessee in that case relied upon the Board circular. As the issue involved in this appeal is already settled by the Honble Orissa High Court in the case of Coal Carriers (supra) and the ratio of the above decision is fully applicable on the facts of the present case, as the terms and conditions of the work orders are similar to the work orders which are under consideration before the Honble High Court, therefore we find no infirmity in the impugned order. The appeal is dismissed.
(Dictated in Court) (P.K. Jain) Member (Technical) (S.S. Kang) Vice President tvu 1 5