TMI Blog2013 (2) TMI 156X X X X Extracts X X X X X X X X Extracts X X X X ..... ature provided under Section 65 would be required to be provided by such person. – Taxable services should be provided to any person by a courier agency in relation to door-to-door transportation of time sensitive documents, goods or articles. On a conjoint reading of the definition of “courier agency” as defined under Section 65, it is apparent that it is only if a courier agency provides services in relation to door-to-door transportation of time-sensitive documents, goods or articles that the taxable event would take place – In the present case, the service receiver hands over cash in Indian currency at a recipient branch, which transfers instructions to the delivery branch, where payment is made from the corpus available at the delivery branch. Thus, there is no movement of the cash from the recipient branch to the delivery branch. There is no transportation of such cash as contemplated under Section 65 of the Act. In the aforesaid premises, the transfer of cash by the assessees in the manner aforesaid, does not fall within the ambit of “courier agency”. As held by the Supreme Court in Murarilal Mahabir Prasad v. B.R. Vad (supra)[1975 (9) TMI 155 - SUPREME COURT OF INDIA] ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce is also provided whenever and wherever required. 5. Show cause notices came to be issued to members of the association, demanding Service tax under Section 73(a) of the Finance Act, 1994 (hereinafter referred to as the Act ) for recovery of interest at the appropriate rate under Section 75 of the Act on the amount of demand and for imposing penalty under Sections 76, 77, 78 and 79 of the Act. The show cause notices culminated into an orders-in-original confirming the demand under Section 73(2) read with Section 72 of the Finance Act, 1994 along with interest and penalty. 6. The assessees carried the matter in appeal before the Commissioner (Appeals) who upheld the order-in-original. Being aggrieved, the assessees preferred appeals before the Tribunal, who vide the impugned order dated 7-4-2005, allowed the appeals of the assessees with regard to levy of Service tax on inter-branch transmission of Indian currency being effected on behalf of the clients. Being aggrieved, the appellant has preferred the present appeals challenging the impugned order of the Tribunal to the extent the same holds that the tender of Indian currencies and its transmission and compensatory payment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons and compensatory payments would not be covered by the levy of Service tax. 9. On the other hand, Mr. Paresh Dave, learned advocate appearing on behalf of the respondent assessees opposed the appeals. Inviting attention to the definition of courier agency as defined under Clause (33) of Section 65 of the Finance Act, 1994, it was submitted that the same contemplates door-to-door transportation of time-sensitive documents, goods or articles utilizing the services of a person, either directly or indirectly, to carry or accompany such documents, goods or articles. It was submitted that unless the aforesaid ingredients are satisfied, the services rendered by any person would not fall within the definition of courier agency . The learned advocate submitted that on a plain reading of the provisions of clause (33) of Section 65 of the Act, it is apparent that the charging event is door-to-door transportation by utilizing the services of a person. Referring to Clause (105) of Section 65 of the Act, which defines taxable service, it was submitted that the said definition gives another indication that the charging event is door-to-door transportation. Attention was invited to the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssume any intention or governing purpose of the statute more than what is stated in the plain language. It is not the economic results sought to be obtained by making the provision which is relevant in interpreting a fiscal statute. [d] The decision of the Supreme Court in the case of CWT v. Ellis Bridge Gymkhana, (1998) 1 SCC 384, was cited for the proposition that the rule of construction of a charging section is that before taxing any person, it must be shown that he falls within the ambit of the charging section by clear words used in the section. No one can be taxed by implication. A charging section has to be construed strictly. If a person has not been brought within the ambit of the charging section by clear words, he cannot be taxed at all. 11. Lastly, it was submitted that the language of Clause (33) of Section 65 of the Act is clear and unambiguous. For the purpose of falling within the ambit of the said provision, a person should be engaged in door-to-door transportation of time-sensitive documents, goods or articles utilizing the services of a person, either directly or indirectly, to carry or accompany such documents, goods or articles. Unless the requirements o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be carried out by utilising the services of a person, either directly or indirectly; (iv) the person whose services are so utilised should carry or accompany such documents, goods or articles. 16. On a plain reading of Clause (33) of Section 65 of the Act, it is apparent that the same envisages actual transportation of time-sensitive documents, goods or articles by a person, who utilises the services of a person, either directly or indirectly, to carry or accompany such documents, goods or articles. In the facts of the present case, the assessees are handed over cash in the form of Indian currency at the recipient branch, which issues instructions to the delivery branch, which, in turn, makes payment from the corpus available with it. Thus, there is no actual transportation of cash from the recipient branch to the delivery branch. What moves is only instructions to the delivery branch through various methods of communication and not the currency. Thus, there is no transportation of the cash amount as envisaged under Clause (33) of Section 65 nor does any person whose services are utilised by the assessee carry or accompany the cash amount. The ingredients of Clause (33) of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ircumstances of his case. As Lord Cairns said many years ago in Partington v. Attorney-General : As I understand the principle of all fiscal legislation it is this: if the person sought to be taxed, comes within the letter of the law he must be taxed, however great the hardship may appear to the judicial mind to be. On the other hand, if the Crown, seeking to recover the tax, cannot bring the subject within the letter of the law, the subject is free, however apparently within the spirit of the law the case might otherwise appear to be. (Emphasis supplied) 28. This passage was quoted with approval by the Privy Council in the Bank of Chettinad v. Income Tax Commissioner and the Privy Council registered its protest against the suggestion that in revenue cases the substance of the matter may be regarded as distinguished from the strict legal position. 29. It is no doubt, true that in construing fiscal statutes and in determining the liability of a subject to tax one must have regard to the strict letter of the law and not merely to the spirit of the statute or the substance of the law. If the Revenue satisfies the Court that the case falls strictly ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not the same thing as saying that a taxing provision should not receive a reasonable construction . If the statute contains a lacuna or a loophole, it is not the function of the court to plug it by a strained construction in reference to the supposed intention of the Legislature. The Legislature must then step in to resolve the ambiguity and so long as it does not do so, the taxpayer will get the benefit of that ambiguity. But, equally, courts ought not to be astute to hunt out ambiguities by an unnatural construction of a taxing section. Whether the statute, even a taxing statute, contains an ambiguity has to be determined by applying normal rules of construction for interpretation of statutes. As observed by Lord Cairns in Pryce v. Monmouthshire Canal and Railway Companies cases which have decided that taxing Acts are to be construed with strictness, and that no payment is to be exacted from the subject which is not clearly and unequivocally required by Act of Parliament to be made, probably meant little more than this, that, inasmuch as there was not any a priori liability in a subject to pay any particular tax, nor any antecedent relationship between the taxpayer and the taxi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tute is to be gathered from the language of the provisions particularly where the language is plain and unambiguous. In a taxing Act, it is not possible to assume any intention or governing purpose of the statute more than what is stated in the plain language. It is not the economic results sought to be obtained by making the provision which is relevant in interpreting a fiscal statute. Equally impermissible is an interpretation which does not follow from the plain, unambiguous language of the statute. Words cannot be added to or substituted so as to give a meaning to the statute which will serve the spirit and intention of the legislature. The statute should clearly and unambiguously convey the three components of the tax law i.e. the subject of the tax, the person who is liable to pay the tax and the rate at which the tax is to be paid. If there is any ambiguity regarding any of these ingredients in a taxation statute then there is no tax in law. Then it is for the legislature to do the needful in the matter. 13. In the case of Bank of Chettinad Ltd. v. CIT the Privy Council quoted with approval the following passage from the opinion of Lord Russell of Killowen in IRC v. Duke ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... agency in relation to door-to-door transportation of time sensitive documents, goods or articles. Thus, for the purpose of falling within the ambit of charging section, the taxable service should satisfy the ingredients of sub-clause (f) of Clause (105) of Section 65 of the Act. 24. On a conjoint reading of the definition of courier agency as defined under Clause (33) of Section 65 of the Act with sub-clause (f) of Clause (105) of Section 65 of the Act, it is apparent that it is only if a courier agency provides services in relation to door-to-door transportation of time-sensitive documents, goods or articles that the taxable event would take place. In the present case, the service receiver hands over cash in Indian currency at a recipient branch, which transfers instructions to the delivery branch, where payment is made from the corpus available at the delivery branch. Thus, there is no movement of the cash from the recipient branch to the delivery branch. There is no transportation of such cash as contemplated under Clause (33) of Section 65 or sub-clause (f) of Clause (105) of Section 65 of the Act. In the aforesaid premises, the transfer of cash by the assessees in the ma ..... X X X X Extracts X X X X X X X X Extracts X X X X
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