2025 (6) TMI 450 - AT - Service Tax

Scope of port under Section 65(81) of the Finance Act 1994 - impugned premises which was considered as port was a major port as per the definition of port given in Section 65(81) of the Finance Act 1994 or not - HELD THAT - The learned adjudicating authority should have considered if at the relevant time the impugned portion of land was a major port as per the statutory provisions. Since this issue goes to the root of the matter it needs to be decided with elaborate findings and in case the contention of the Advocate is acceptable then the department s case cannot survive. It is deemed fit to remand the matter to the adjudicating authority to decide the issue in detail and the whole appeal in the light of his findings. As far as learned Advocate is concerned he shall be free to make legal submissions on this point with any other evidences indicating that at the relevant time the portion of land impugned was not a major port as per the definition borrowed under Finance Act 1994. Matter is remanded with above directions. Appeal allowed by way of remand.

Summary

The Appellate Tribunal (CESTAT Ahmedabad) addressed a pivotal legal issue concerning the definition of "port" under Section 65(81) of the Finance Act, 1994, which incorporates the meaning assigned in Clause (q) of Section 2 of the Major Port Trusts Act, 1963. The appellant contended that the impugned premises, treated as a port by the department, was not a "major port" as statutorily defined, and hence, services rendered there could not attract service tax.The Tribunal noted that Clause (q) defines "port" exclusively as "any major port" notified by the Central Government, emphasizing that service tax applicability hinges on the location being a major port. The learned adjudicating authority had failed to address this crucial point, rendering the order non-speaking on a matter that "goes to the root of the matter."Acknowledging the absence of detailed findings on whether the impugned land qualified as a major port at the relevant time, the Tribunal remanded the matter for a thorough examination. The adjudicating authority was directed to decide with elaborate findings whether the statutory definition of a major port applied, as the appellant was permitted to submit further legal arguments and evidence on this issue.The appeal was allowed by remand, underscoring that if the impugned premises is not a major port under the statutory framework, the department's case for service tax cannot survive.