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2014 (6) TMI 311 - AT - Service TaxDemand of service tax - Commercial and Industrial Construction Service - Whether the "Onshore Terminal" developed by M/s Reliance Industries Ltd at Pedda Gadimoga Village, near Kakinada, Andhra Pradesh could be considered to be as "Transport Terminal" for the purpose of exclusion from levy of service tax under the category of "Commercial and Industrial Construction Service." - Held that:- there is no arrival from different destination and dispersal to different destination. Movement of gas is unidirectional and is fixed. Here there is just one item. There is no arrival of freight. Extracted fluid is received. Processed dry gas is sent to distribution pipeline - Recovered MEG is processed and again pumped to sub-sea facility. TEG is used in the OT for processing. We find that the said Article speaks about various transport terminals but does not talk of transport terminal for gases. Thus, in our view, the concept of transport terminal is relevant for transportation by air, sea, road and not for transporting gases through pipelines. In any processing facility, material has to be received and dispatched but that would not make the processing facility as ‘Transport Terminal'. In our view, transportation is only incidental to the processing facility. After all the fluid received is for extraction of dry gas and thereafter the dry gas is required to be sold to its customers and therefore there has to be facility to receive and transport the same. Even the owner of the facility calls the facility as ‘Onshore Terminal' and does not call it ‘Transport Terminal'. This itself indicates that even the owner does not recognize the facility as ‘Transport Terminal'. We have no hesitation in holding that the facilities available at the onshore terminal at Gadimoga cannot be termed as ‘Transport Terminal'. There is no requirement that the transport terminal should be owned by a public authority alone. However, since we have held that the onshore terminal at Gadimoga cannot be considered as transport terminal, this argument though in favour of the appellant does not help in the present situation. Extended period of limitation - Held that:- Proviso to Section 73 has been invoked and penalty also has been imposed under Section 78 of the Finance Act. We find from the impugned order that the appellant was of the view that immediately on receipt of mobilization advance that the service tax is required to be paid and there have been exchange of letters between the appellant and their client about the same. However, later on instead of collecting the service tax from the customers, started requesting a comfort letter from their client which was also not received by them. Under the circumstances, it is a clear cut case where the appellant knew their service tax liability but still chose not to collect and pay, but started asking comfort letter. This is clear cut suppression of facts, contravention of provision of service tax law with willful intention and therefore the extended period is rightly invoked. Penalty under Section 76, Section 77 and Section 78 of the Finance Act, 1944 has also been correctly imposed. Demand alongwith interest and penalty confirmed - Decided against assessee.
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