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2013 (2) TMI 559 - Commissioner - Service TaxActivity of supply of floating rigs - whether the activity of supply of floating rigs by M/s. Aban Offshore Ltd. is covered under the category “Supply of tangible goods” service as contended by the appellant or under the category “Mining service” – Held that:- ‘Mine’ has been very widely defined to include infrastructure created for mining of minerals, oil or gas. Thus, the meaning of mining has to be restricted to process of extracting metallic or non-metallic mineral deposits. In short, the word ‘mining’ must be understood as the process of taking minerals, gas or oil from underneath the surface of the earth. Pocess of actual extraction of mineral, oil or gas from beneath the earth is taxable under this category. In the instant case the floating rigs supplied by M/s. Aban is used by the appellant for purifying the extracted oil which is an activity subsequent to the extraction of oil. As the activity to be taxed under “Mining Service” is restricted to actual extraction of oil, the process carried out by the appellant after extraction of oil by using the floating rigs supplied by M/s. Aban is definitely not covered under this category. Hence the activity of supply of floating rigs to the appellant by M/s. Aban is not covered under “Mining Service”. The taxability of ‘supply of tangible goods services’ would get attracted when a supply of tangible goods including machinery, equipment and appliances is made for the use of service recipient. The taxable service covers where tangible goods are supplied without transferring possession and effective control thereof though the goods are made available to the service recipient for use. In the instant case, M/s. Aban had supplied floating rigs to the appellant for post extraction activity without transferring possession and effective control. As per Section 65A of the Finance Act, if a service is classifiable under two or more sub-clauses of clause (105) of Section 65, Classification shall be effected to the sub-clause which provides the most specific description to sub-clauses providing a more general description. Activity of supply of floating rigs by M/s. Aban Offshore Ltd. to the appellant is more specifically covered under the category “Supply of tangible goods service” – Therefore supply of floating rigs covered under “Supply of tangible goods” service, appellant has erroneously paid the service tax for the disputed period and the appellant is right in claiming the refund. Further judgement in the case of Indian National Shipowners’ Association v. Union of India[2009 (3) TMI 29 – BOMBAY HIGH COURT] which was later affirmed by the Hon’ble Supreme Court[2010 (12) TMI 12 - SUPREME COURT OF INDIA] is relevant to this case where it was held that a service not covered by any entry prior to insertion of entry is not liable to Service tax till entry was introduced covering them – Service tax on supply of rig is taxable only w.e.f. 16-5-2008 under the category “Supply of tangible goods” service and that they had been erroneously charged by M/s. Aban Offshore Ltd. under “Mining Service” and the same was paid by them erroneously for the period 1-6-2007 to 15-5-2008 under the said category; and hence they are eligible for the refund – Refund claim is not hit by limitation inasmuch as the time prescribed under Section 11B is applicable only to those tax which is collected as permitted by the statute and in the instant case the tax was collected without authority of law and hence time limit is not applicable – Appellant is eligible for the refund claimed by them – Appeal allowed, refund claim sanctioned – In favour of assessee.
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