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2018 (8) TMI 332 - CESTAT HYDERABADClassification of Services - work of loading and unloading of reels/reams/bundles/pallets on to and from trailer/trucks in the godown within the company’s mill - extended period of limitation - penalty. Held that:- The term “cargo” is not defined in Finance Act, 1994. Therefore, the dictionary meaning of the word which refers to “goods carried on ship, aircraft or motor vehicle.” Thus, for the activity to be classified as cargo handling services, the goods in question must be cargo, i.e., the goods must be put on a motor vehicle or ship or aircraft etc., and moved out of or into factory. The contract requires the handing to be done within the godown of the mill premises but is silent on whether this handling is meant for movement within the factory or it is handling of cargo to be shifted out of the factory. Usually, goods are moved within the factory, using material handling equipment such as cranes and forklifts although trucks etc., can also be used - If the goods are moved out of the factory or into the factory they meet the definition of “cargo” and the activities of handling it is “cargo handling service” - the activity under taken by the appellant/assessee must be classified as cargo handling service. Extended period of limitation - Held that:- It is not in dispute that this is a classification issue and the Department had issued the show cause notice in 2008 whereas, the assessee had been paying service tax under various other headings namely Manpower supply and Business Auxiliary Service from 2005 onwards. Thus, the nature of activity undertaken by the assessee is within the knowledge of the Department from 2005-2006 onwards - there is no ground to invoke extended period of limitation in this case. Penalty - Held that:- As it is the question of interpretation of classification of services, where the Department appears to have changed its opinion, no penalties under Section, 76, 77 & 78 are imposable. The penalties are therefore set aside and the demand along with interest within the normal period of limitation is upheld - The demand for extended period is set aside - appeal allowed in part.
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