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TMI Blog2007 (11) TMI 90X X X X Extracts X X X X X X X X Extracts X X X X ..... fields Ltd. The work performed by appellants involved transportation of coal inside the colliery area and mechanical transfer of coal to Tippers at quarry face. The authorities below have held that the appellants have provided cargo handling services to M/s. Mahanadi Coalfields Ltd. and hence have demanded service tax on the gross amount received by the appellants. It is the contention of the appellants that the work undertaken by them does not fall in the category of cargo handling services. They have stated that M/s. Mahanadi Coalfields Ltd. had examined, the activities undertaken under the contract and had clarified to the appellants well as to similar other contractors that the activities undertaken are not in the nature of cargo handli ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l as the meaning of cargo. We find that in these two cases before us, both the appellants have executed work under a contract with M/s. Mahanadi Coalfields Ltd. for Service Tax Appeal Nos. 25 & 29/06 movement of coal within mining area. The agreement entered into by the appellants with M/s. Mahanadi Coalfields Ltd. reveals that the work performed by the appellants involved transportation of coal inside the colliery area and mechanical transfer of coal to Tippers at quarry face. The amount received by the appellants also includes the cost of operation of machinery involved in the mechanical transfer of coal. The appellants have challenged the duty demand on the ground that the mechanical transfer of coal to Tippers and transportation of coal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onto or unloading from any ship/vessel/vehicle which conveys the coal from/to our own mining premises and therefore, the coal cannot stand in the same footing as that of "cargo". This is to bring to your notice that right from the coal face to Railway siding everything in between (inclusive both) constitute "mine" as defined by the Mines Act. Something going out of mines by conveyance to end user or something coming into mines by conveyance from suppliers may constitute cargo but not something moved from place to place within the periphery of one mine. The first chargeable/taxable event in order to levy service tax on "cargo handling service" is that the thing "handled" must be "cargo" - in the instant case the coal transported by you is n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ich is carried as freight in a ship, plane, rail or truck and the activities undertaken by the appellants in terms of the contracts on behalf of M/s. MCL to move coal within mining area do not fall in the category of cargo handling service. Moreover, the activities undertaken are principally the transportation of coal within mining area and hence, the gross amounts received for the same cannot be taxed under the category of cargo handling service. We have, therefore, no hesitation in our mind to hold that the definition of cargo handling service under the Finance Act, 1994, does not include the kind of activities undertaken by the appellants and hence the same are not chargeable to service tax. We also find that there was no suppression or ..... X X X X Extracts X X X X X X X X Extracts X X X X
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