TMI Blog2018 (7) TMI 1671X X X X Extracts X X X X X X X X Extracts X X X X ..... f the Finance Act, 1994 read with Section 2(7) of Sale of Goods Act, 1930 - the transportation of effluents cannot be treated as transportation of 'goods' and hence there cannot be any service tax liability under ‘Goods Transport Agency’ as defined in Section 65 (150b) of the Finance Act, 1994 - tax liability and penalty set aside. Liability of Service Tax - freight paid towards transportation of crude oil and condensate within the operational area - transportation services received for transport of various goods out of operational area - Held that:- As the appellants have conceded the tax liabilities of ₹ 79,90,126/- in respect of freight paid for transportation of crude oil condensate as also the tax liability of ₹ 67,935/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Alleged short paid amount of service tax in respect of transportation services received for transport of various goods out of operational area Rs.67,935 Total Rs.91,82,319 Show cause notice dt. 20.04.2010 was issued to the appellants inter alia proposing recovery of the aforesaid amounts along with interest thereon and appropriation of ₹ 71,14,271/- paid towards service tax liability and ₹ 19,94,882/- paid towards interest liability. The SCN also proposed imposition of under various provisions of law. In adjudication, the original authority vide impugned order dt. 31.08.2010 confirmed these proposals and also imposed penalt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Hon ble Supreme Court judgment in Escorts Ltd. Vs CCE Faridabad - 2015 (319) ELT 406 (SC) and UOI Vs Delhi Cloth and General Mills Co. Ltd. - 1977 (1) ELT J199 (SC). He submits that for these reasons tax demand of ₹ 11,24,258/- on transportation of effluents under GTA cannot sustain. iv) In respect of other tax liabilities which appellants are not pressing, Ld. Advocate submits that there cannot be any penalty liability in those cases. He draws our attention to paras 26.2 of the OIO and paras 11 12 of the SCN to point out that right from the beginning, the appellants have been taking a stand that crude oil, condensate as well as effluent water have no marketability and therefore their transport will not attract service tax under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under bonafide belief that condensate per se would not come within the scope of goods and hence there would be no tax liability under GTA on that score. Such bonafide belief is reflected in paras 11 12 of SCN and para 26.2 of OIO as pointed out by Ld. Advocate. It is also pertinent to note that these tax liabilities have also been paid up by the appellants before issue of SCN. Hence we hold that there will not be any penalty in respect of freight paid towards transportation of condensate. In respect of amount of ₹ 67,935/-, the amount being very small and also admittedly arising out of quantification dispute, the penalty in that respect is also set aside. 5.3 Coming to third issue of freight paid in respect of transportation of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e relevant facilities/services of transportation provided by appellant are not for the goods as defined in Section 2(7) of the Sale of Goods Act, 1930, the same cannot be considered as a service provided for transportation of goods as per Section 65(105)(zzz) of the Finance Act, 1994 read with Section 2(7) of Sale of Goods Act, 1930. Appeal filed by the appellant is, therefore, required to be allowed. 5.4 Though the Ld. A.R was at pains to draw our attention to adjudicating authority s conclusions that the meaning of goods for the purpose of Finance Act, 1994 will have the meaning as defined in Sale of Goods Act, 1930, however that meaning has been further interpreted by the judgment of the Hon ble Supreme Court in Escorts Ltd. (su ..... X X X X Extracts X X X X X X X X Extracts X X X X
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