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2014 (12) TMI 378 - CESTAT BANGALOREWaiver of pre deposit - Mining of mineral, oil or gas service - Imposition of interest and penalty - Held that:- Activity undertaken by the appellants is mining of iron ore and there is no dispute on that aspect. Iron ore is also an item for which a separate heading is available in the schedule of Tariff. It is also covered by Chapter 26. Therefore the same activity of mining of iron ore can be liable to service tax as well as excise duty. When it comes to Central Excise duty, excise duty will be leviable on the total transaction value and on the entire quantity of iron ore extracted. When it comes to service tax, the amount paid as consideration for the iron ore extraction would be the amount leviable to service tax. The nature of taxes is entirely different; taxable events are different. The mines were owned by individuals who are partners of Sree Gavisiddeshwara Minerals. The right to extract/mine the ore and sell was given to Sree Gavisiddeshwara Minerals. Sree Gavisiddeshwara Minerals and all the partners constituting the partnership firm entered into a contract with the appellant and entrusted the work of mining of ore for a consideration of 64% of the ore that is extracted. In such a situation, when two parties viz. Sree Gavisiddeshwara Minerals and the appellant have treated themselves as two separate entities, obviously the appellant becomes the service provider and the others who owned 36% become the service receivers. In fact in this case, the iron ore mined is initially handed over to Sree Gavisiddeshwara Minerals, who in turn allocated 64% to the appellant and distributed the balance 36% to the other partners. Therefore the appellant, a limited company, has provided a service of mining of ore to Sree Gavisiddeshwara Minerals, a partnership firm. Therefore we consider that prima facie, the appellant may not have a case - Partial stay granted.
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