TMI Blog2013 (7) TMI 96X X X X Extracts X X X X X X X X Extracts X X X X ..... g units - the compensation is fixed on per day basis - thus even when no drilling takes place, the service provider is compensated – thus the transaction involved is one of service as it was decided in Indian National Ship owners Association Vs. UOI (2009 (3) TMI 29 - BOMBAY HIGH COURT). Validity of show cause notice – The notice was served within a period of one year – thus the show-cause notice is within time and the allegation of time bar is not sustainable. Appellant directed to submit 50% of the amount - stay granted partly. - ST/85231/13 - S/429/13/CSTB/C-I - Dated:- 25-3-2013 - P R Chandrasekharan And Anil Choudhary, JJ. For the Appellant : Mr S Srinath, CA For the Respondent : Mr P N Das, Comm (AR) Per: P R Ch ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sions. 3.1 As per the contract entered into by the appellant with ONGC, the services required to be rendered by the appellant is drilling of wells in the areas specified by the ONGC and the compensation is paid to the appellant for the works performed/services rendered and material/equipment supplied and personnel furnished by the Contractor, at the rates specified in the contract. It is the case of the appellant that the activity undertaken is not "supply of tangible goods' for use but comes under the category of drilling of oil wells. Therefore, the services rendered merits classification under mining services falling under Section 65 (105 (zzzy) of the Finance Act, 1994. It is also argued that during the impugned period, the drilling w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... into between the appellant and the ONGC, it is for charter hire of the drilling rigs and the drilling operation was conducted at the areas designated by the ONGC. He also submits that as per the terms of the contract, the compensation paid to the appellant is based on the number of days during which the vessel was on charter hire and even when the vessel was not used for drilling, the compensation was paid to the appellant by the ONGC. Similarly, even when drilling rigs were moved from one place to another, for the period in transit also hire charges were paid. This fact clearly indicates that the services rendered by the appellant is hiring of vessels for ONGC and since the vessel was under the operational control of the appellant, the act ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed becomes India for the purpose of levy of service tax and therefore the impugned demand is sustainable. He also relies on the decision of the Bombay High Court in the case of Indian National Ship Owners Association and of the Andhra Pradesh High Court in the case of Rashtriya Ispat Nigam Ltd. in support of his contention. Accordingly, he prays for putting the appellant to terms. 5. We have carefully considered the submissions made by both the sides. 5.1 We have also perused the agreement entered into by the appellant with ONGC. The agreement is for charter hiring of drilling units by the appellants to ONGC or its subsidiaries. The Hon'ble High Court of Bombay in the case of Indian National Shipowners' Association Vs. UOI, reported in ..... X X X X Extracts X X X X X X X X Extracts X X X X
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