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2019 (3) TMI 864 - AT - Service TaxClassification of services - Hiring of Heavy Earth Moving Equipment - Whether the activity performed by the appellant would fall under the category of ‘Site formation services’? - Held that:- On a reading of section 65 (105) (zzza) and the definition of ‘site formation’ contained under section 65 (97a) and the budget letter dated 27 July, 2005, there is no manner of doubt that the service referred to is prior to the actual activity of mining. Drilling, boring and core extraction services for construction of geophysical, geological or similar purpose is carried out to determine the feasibility for digging any mine prior to mining and it is this service on which service tax is sought to be levied under section 65 (105) (zzza) - It is not the case of the department that the activity that was carried out by the appellant was prior to mining - In such circumstances, it is not possible to accept the contention of the Department that the services would fall under the category of “’Site Formation”. Classification of services - Transportation of Limestone - Cargo Handling Service or Good Transportation Agency Service? - Held that:- The composite service may include various intermediary and ancillary services such as loading/ unloading, packing / unpacking etc. provided in the course of transportation of goods by road. These services are not provided as independent activity but as means of successful implementation of the principal service, namely the transportation of goods by road. It has, therefore, been clarified that a composite service even if it consists of more than one service, should be treated as a single service based on the main or principal service. It has, therefore, been held that any ancillary / intermediate service provided in relation to transportation of goods, and the charges, if any, for such services are included in the invoice issued by the Goods and Transport Agency and not by any other person. Such service would form part of Goods and Transport Agency Service and , therefore, the abatement of 75% would be available on it - It is apparent that the essential feature of the service is transportation. Loading and unloading are ancillary / intermediate service provided in relation to transportation of goods, and such service would be Goods and Transport Agency Service. It cannot be ‘Cargo Handling service’ as was found by the Commissioner. Valuation - inclusion of cost of diesel in assessable value - Held that:- The cost of diesel cannot be included in the gross amount since it has been supplied free of cost by the service recipient. Appeal allowed - decided in favor of appellant.
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