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2017 (3) TMI 938 - CESTAT NEW DELHIClassification - Cargo handling services / airport services - The service tax liability was sought to be confirmed on the appellant under the category of “storage and warehousing service” upto 09/09/2004 and under “airport services” w.e.f. 10/09/2004. The appellants contended that the services now sought to be categorized under these tax entries were actually “cargo handling services” and as they relate to export cargo they are excluded from tax liability - Held that: - the appellants are basically engaged in various composite activities starting from receipt, shifting, handling, loading, packaging in suitable manner, security X-ray, scanning and loading of cargo for outward movement by aircraft. These activities are not relating to storage and warehousing of cargo - The cargo brought by exporters are not for storage or warehousing in the airport. The cargo is brought for shipment and the shipment happens at the earliest available opportunity. Till the shipment, the cargo is held for a short duration by the appellant. During this duration, various activities to make the cargo fit for shipment is undertaken - As such, appellant are not involved in providing storage and warehousing service with reference to the cargo - there is no tax liability under this tax entry for the appellant upto 09/09/2004. Admittedly the appellants are an airport authority involved in providing service in the airport. The claim of the appellant is that ‘cargo handling service’ is more specific than ‘airport service’. We are not in agreement with such proposition. While cargo handling may be specific with reference to services rendered in connection with cargo, ‘airport service’ is also specific to the extent that this service can be rendered only by airport authority or any other person in a designated airport or a civil enclave. The service is area specific - this is not a general category of tax entry - the services rendered by the appellant are taxable under the category airport service w.e.f. 10/09/2004. Time limitation - Held that: - these activities were not subjected to levy as they were relating to export cargo till 09/09/2004. The all covering entry of airport service was brought in w.e.f. 10/09/2004. As such, there is no justification for the allegation of fraud, collusion, willful mis-statement and intention to evade tax against the appellant - the service tax liability shall be restricted to the normal period - penalty u/s 77 and 78 also set aside for the same reason. Appeal allowed - decided partly in favor of appellant.
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