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2012 (6) TMI 67 - AT - Service TaxWaiver of pre-deposit – Whether assessee CPT was liable to pay Service Tax under 'Port Services' on royalty, upfront charges, rent on jetties and estate rentals received Royalty - Royalty charges were paid by IGTPL to develop and operate RGCT within the port premises – Held that:- This amount was paid by IGTPL to CPT for allowing it to develop and operate Rajiv Gandhi Container Terminal at the port premises. royalty received by the appellant is not a consideration for any port services rendered by CPT. If at all IGTPL pays service tax as demanded, the same will be available to it as cenvat credit, and can be used to meet its liability on services rendered by it. demand not liable to be sustained Regarding upfront charges - ownership/lease hold rights of the equipment of the appellant shall stand transferred to the licensee from the date of receipt of first instalment of the upfront payment. consideration received was accounted in the financial records of CPT as sundry debtors and the value of the assets written off at the written down value of ₹ 7.6 crores. Even if the equipment is held to have been leased to IGTPL and not sold, no tax can be levied on the consideration as it is not received towards port services rendered by CPT Regarding rental amounts collected for renting out various jetties within the port area – Held that:- assessee did not put up jetties but collected charges for licenses granted to other persons to put up structures on the waters coming within the administrative jurisdiction of CPT. These charges are collected in accordance with Cochin Port (licensing of jetties, slipways and boat pen) Regulations, 1968. these charges for licenses as not classifiable under 'port services' or taxable under that head Regarding estate rentals - these are recovered for leasing out immovable property of IGTPL for permitting it the use of the site belonging to CPT. Renting of immovable property services under which the impugned activity will be appropriately classified was introduced only on 1.6.2007 post the period of dispute. Therefore, the impugned demand under 'Port Services' is liable to be set aside Demand and penalty set aside and appeal allowed
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