TMI Blog2013 (8) TMI 640X X X X Extracts X X X X X X X X Extracts X X X X ..... ing of crude cannot be made through pipelines laid under the sea bed or in specific weather conditions. As decided in Indian National Ship Owners Association v/s Union of India (2008 (12) TMI 41 - HIGH COURT OF BOMBAY) – the said activity would come under supply of tangible goods for use – the same was brought under the service tax net with effect from 16/05/2008. Stay application –stay granted as the appellant being govt. undertaking there is no risk to revenue. - ST/315/12 - S/467/13/CSTB/C-I - Dated:- 5-3-2013 - P R Chandrasekharan And Anil Choudhary, JJ. For the Appellant : Mr Bharat Raichandani, Adv. For the Respondent : Mr Rakesh Goyal, Addl. (AR) Per: P R Chandrasekharan: 1. The appeal and stay application ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ervice tax amounting to Rs.25,04,29,302/- during the period 01/10/2002 to 31/12/2007 vide show-cause notice dated 16/4/2008. The notice was adjudicated vide the impugned order and demands were confirmed along with interest thereon and also by imposing an equivalent amount of penalty. Hence, the appellant is before us. 3. The Ld. Counsel for the appellant makes the following submissions. 3.1 The ONGC charter hires oil tankers for storage and transportation of crude oil from offshore to designated refineries. The crude oil produced at Bombay High is evacuated through tankers and the tankers are an integral part of offshore operations. The tankers are deployed for storage and transportation of crude oil from SBM to refineries. As per the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... used for transportation of crude from the oil wells to the various ports and the primary function of the said vessel is transportation of crude oil from the oil well to the ports. Therefore, the activity undertaken by the appellant is not storage and warehousing service but charter hiring of the vessel and they are not liable to discharge any service tax on the said activity under "storage and warehousing service" 3.3 The Ld. Counsel also submits that from the deployment of tankers during the period April 2002 to December 2007 it can be seen that the tankers have been deployed for a period as short as one day to as high as 110 days and the vessels carrying the crude have sailed off to various ports in India from Bombay High carrying the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has already been covered under the category of port service". 3.5 The intention of the legislature was to cover the services provided by agencies such as Central Warehousing Corporatiion, ICDs, Container Freight Stations, airport authorities, railway authorities and so on and the activities sought to be covered included providing space to keep the goods, loading, unloading and stacking of goods in the storage area, keeps inventory of goods, makes security arrangements and provide insurance cover, etc. The said clarification makes it clear that the activity of transportation and storage incidental thereto do not fall within the scope of service. He also relies on the decision of the Hon'ble Bombay High Court in the case of Indian National ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he utility of the mother vessel is that the oil produced in the offshore will be stored in the mother vessel and it will be transported from mother vessels to other ports in India through the daughter vessels. Thus, it is the daughter vessel which will undertake the transportation of goods and not the mother vessels. Since the mother vessels perform the storage of crude oil at the production site, they fall within the definition of storage and warehousing service and accordingly, the demands have been correctly confirmed. Therefore, 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 contract entered into between the appellant and the ONGC. The ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
