TMI Blog2010 (1) TMI 694X X X X Extracts X X X X X X X X Extracts X X X X ..... ind that no tax can be levied on the consideration as it is not received towards port services rendered by CPT. Upfront charges - The royalty amounts were paid by IGTPL @ 33.33% of its gross revenue under its agreement with CPT - This amount was paid by IGTPL to CPT for allowing it to develop and operate Rajiv Gandhi Container Terminal at the port premises - Do not find any logic in treating CPT allowing IGTPL, to develop and operate the container terminal as an activity falling under port services. The royalty received by the appellant is not a consideration for any port services rendered by CPT. If at all IGTPL pays service tax as demanded, the same will be available to it as cenvat credit, and can be used to meet its liability on servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... against them vide order No.13/2010/ST dated 5.3.2010 impugned in the captioned appeal. After hearing the parties on stay application for some time, we find that the appeal can be disposed of without further hearing. Accordingly, after disposing the stay application for pre-deposit, we take up the appeal itself. 2. The assessee had entered into an agreement with M/s. India Gateway Terminal Pvt. Ltd. (IGTPL) for operation and management including necessary modification and augmentation of facilities for a maximum period of 8 years and 6 months from the date of commencement of commercial operation of container transport at Rajiv Gandhi Container Terminal (RGCT) at Cochin Port. In terms of the agreement, IGTPL shall pay CPT royalty every mon ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Rs.48,960/- 3 Rent on Jetties Rs.5,96,071/- Rs.71,210/- Rs.1,424/- Rs.712/- 4 Estate Rentals Rs.12,91,26,562/- Rs.1,48,96,824/- Rs.2,97,936/- Rs.1,48,968/- Total Rs. 34,74,86,030/- Rs. 4,08,34,791/- Rs. 8,16,695/- Rs. 4,08,348/- The Commissioner also imposed penalties on CPT under Section 76, 77 and 78 of the Finance Act, 1994. 3. The impugned order is challenged on various grounds. Royalty charges were paid by IGTPL to develop and operate RGCT within the port premises. This amount was not a consideration for any taxable service rendered by the appellant and could not be subjected to Service Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... @ 33.33% of its gross revenue under its agreement with CPT. This amount was paid by IGTPL to CPT for allowing it to develop and operate Rajiv Gandhi Container Terminal at the port premises. We do not find any logic in treating CPT allowing IGTPL, to develop and operate the container terminal as an activity falling under port services. The royalty received by the appellant is not a consideration for any port services rendered by CPT. If at all IGTPL pays service tax as demanded, the same will be available to it as cenvat credit, and can be used to meet its liability on services rendered by it. We find the impugned demand not liable to be sustained. 5.2 As regards the upfront charges, we note that these are collected from IGTPL as per Claus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng useful life of the licensor's equipment sought to be disposed off and appropriation of the value received on disposal of and appropriation of the value received on disposal against the remaining installments of the Upfront Payment. In terms of this clause, ownership / lease hold rights of the equipment of the appellant shall stand transferred to the licensee from the date of receipt of first installment of the upfront payment. The leasehold rights and ownership of crane leased from M/s. ABG Heavy Industries Ltd., was also passed on to the licensee. The consideration received was accounted in the financial records of CPT as sundry debtors and the value of the assets written off at the written down value of Rs.7.6 crores. Even if the eq ..... X X X X Extracts X X X X X X X X Extracts X X X X
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