Custom, Excise & Service Tax Tribunal
Seabird Marine Services Pvt. Ltd vs Raigad on 24 August, 2016
IN THE CUSTOMS, EXCISE AND SERVICE TAX APPELLATE TRIBUNAL
WEST ZONAL BENCH AT MUMBAI
APPEAL NO: ST/88748/2013
[Arising out of Order-in-Appeal No: US/156/RGD/2013 dated 10th June 2013 passed by the Commissioner of Central Excise (Appeals II), Mumbai.]
For approval and signature:
Honble Shri C J Mathew, Member (Technical)
1.
Whether Press Reporters may be allowed to see the Order for publication as per Rule 27 of the CESTAT (Procedure) Rules, 1982?
:
No
2.
Whether it should be released under Rule 27 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not?
:
No
3.
Whether Their Lordships wish to see the fair copy of the Order?
:
Seen
4.
Whether Order is to be circulated to the Departmental authorities?
:
Yes
Seabird Marine Services Pvt. Ltd.
Appellant
Versus
Commissioner of Central Excise
Raigad
Respondent
Appearance:
Shri Mehul Jivani, Chartered Accountant for the appellant Shri M.P. Damle, Asstt. Commissioner (AR) for the respondent CORAM:
Honble Shri C J Mathew, Member (Technical) Date of hearing: 24/08/2016 Date of decision: 24/08/2016 ORDER NO: ____________________________ Issue in dispute is the disallowance of CENVAT credit of ` 2,20,293/- under rule 14 of CENVAT Credit Rules, 2004, demand of interest thereon, and imposition of penalty on appellant, M/s Seabird Marine Services Pvt Ltd. Appellant operates a container freight station (CFS) and availed credit of tax paid on usage of transportation services deployed for transfer of empty containers to container yard on the ground that provision of service is complete upon destuffing of containers in the freight station. Commissioner of Central Excise (Appeals-II), Mumbai vide order-in-appeal no. US/156/RGD/2013 dated 10th June 2013 upheld the order of original authority leading to the impugned order.
2. Heard Learned Chartered Accountant appearing for appellant and Learned Authorised Representative. It is common ground that taxes have been discharged on billing of transportation charges and the dispute is limited to whether the disallowed amount of ` 2,20,293/- pertains to an input service.
3. I find that the disallowance is based on an improper understanding of the service rendered and the identity of the recipient of service. A container freight station (CFS) provides services to different entities and the containers that are handed cannot be distinguished as that relating to service rendered to one of those entities.
4. Containers are the medium for carriage of goods from point to point and enable despatch from doorstep to doorstep to eliminate the inconvenience of multiple handling of goods from origin to destination. The mode of transport is not a factor in such transport. Goods undoubtedly belong to the shipper/consignee and services of the container freight station (CFS), in relation to these entities, are limited to goods for which the agent of consignee, viz., customs broker is charged. However, movement to container freight station (CFS) from port of discharge is at the option of steamer agent (again of various hues) and the service includes storage and handling of containers till they are handed over for stuffing of export cargo or despatch as such.
5. Appellant discharges service tax liability on amounts charged as per rate list for handling of containers. Once tax liability is discharged on output service, Revenue is hardly in a position to claim that the services utilised in the process of rendering output service is not entitled to be an input service. Appellant also relies on circular no. 96/7/22007-ST dated 23rd August 2007 of Central Board of Excise & Customs which clarifies that empty containers are also goods for the purpose of storage and warehousing services in section 65 (105)(zza) of Finance Act, 1994.
6. For the above reasons, the impugned order is set aside and appeal allowed.
(Pronounced in Court) (C J Mathew) Member (Technical) */as 2 2