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2015 (9) TMI 159 - AT - Service TaxDemand of service tax - Cargo handling service - activity of grinding of rock phosphate - Penalty u/s 76, 77 & 78 - Held that:- Payment rates were composite rates not amenable to identification as to what rate/amount was paid to those components of services which were arguably in the nature of cargo handling service. When quantification is not possible, the levy fails. However, without elaborating on this judicial principle, we find that in the case of Commissioner of Central Excise Bhubaneswar versus B.K. Thakkar [2007 (10) TMI 147 - CESTAT, KOLKATA] CESTAT while deciding a similar issue held that excavation, transportation and feeding of iron ores to crusher plant for processing were incidental activities for processing, and therefore, the entire contracted activities did not get the character of cargo handling service. Further, it is seen that from 10.09.2004, appellant has been paying service tax on the entire consideration received under business auxiliary service on account of the fact that "production of goods on behalf of the client" was added to the definition of BAS from the said date Overall nature of contract did not make it amenable for coverage under cargo handling service - when the issue involves interpretation of law, extended period cannot be invoked. Also, the conditions for imposing penalty under Section78 are identical to those required for invoking extended period. Therefore, when 78 penalty has been found to be unimposable, invocation of extended period also cannot be sustained and as a consequence thereof, the entire demand is hit by time-bar. - Decided in favour of assessee.
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