TMI Blog2016 (8) TMI 1054X X X X Extracts X X X X X X X X Extracts X X X X ..... 014 - A/88830-88832/16/STB - Dated:- 28-1-2016 - Shri M V Ravindran, Member (Judicial) and Shri C J Mathew, Member (Technical) Shri V. Sridharan, Sr. Advocate with Shri Vinay Jain, Chartered Accountant for the appellant Shri V.K. Singh, Special Counsel for the respondent ORDER Mumbai International Airport Pvt Ltd, a joint venture of GVK Airport Holdings-led consortium and Airport Authority of India, entered into operational, management and development agreement dated 4th April 2006 with the Airport Authority of India to undertake some of the activities enjoined upon the Airport Authority of India under the Airport Authority of India Act, 1994 at the Chatrapati Shivaji International Airport, Mumbai. M/s Mumbai International Airport Limited had vide notification dated 27th February 2009 been authorized by the Central Government under section 22A of the said Act to collect a development fee @ ₹ 100/- for every departing domestic passenger and ₹ 600/- for every departing international passenger at Chatrapati Shivaji International Airport with effect from 1st April 2009 for a period of 48 months. 2. The Commissioner of Service Tax, in show caus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s not liable to taxation. The decision of the High Court of New Zealand Wellington Registry in Rotorua Regional Airport Limited v Commissioner of Inland Revenue dated 1st April 2009 was cited as having persuasive value. The following cases were also relied upon: i. Mahesh Sunny Enterprises P Ltd. v. Commissioner of Service Tax, New Delhi [2014 (34) STR 21 (Del.); ii. Cochin International Airport Ltd v. Commissioner of Central Excise Customs, Kochi [2007 (7) STR 468) (Tri.-Bang.)] iii. Commissioner of Central Excise v. Cochin International Airport Ltd [2009 (16) STR 401 (Ker)]. 5. Learned Authorised Representative relies upon decision of the Hon ble Supreme Court in Bharat Sanchar Nigam Ltd v. Union of India [2006 (2) STR 161 (SC)] with specific reference to paragraph 80: 80. In determining the issue, however the Assessing Authorities will have to keep in mind the following principles: If the SIM Card is not sold by the assessee to the subscribers but is merely part of the services rendered by the service providers, then a SIM card cannot be charged separately to sales tax. It would depend ultimately upon the intention of the parties. If the parties ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... analysis of the decision of the remanding authority. The adjudicating authority has merely gone through the motion of discussing the various citations referred to in the remand order instead of proceeding in accordance with the direction of the Tribunal. The Tribunal had drawn specific reference to the cited judgments to enable the adjudicating authority to render an informed finding keeping the following proposition in mind: whether a statutory levy compulsory extraction intended for a public purpose that does not benefit the individual subject to the levy is a taxable consideration for service within the scope of section 65 (105)(zzm) of Finance Act, 1994. That direction has not been complied with. We also note that the show cause notice, too, is silent on the nexus between development fee and consideration for a taxable service; it has proceeded on the assumption that the appellant, being a airport operator and subject to service tax, is required to pay tax on the entirety of its collection. These flaws render the notice and demand to be not tenable and the demand would fail on this count itself. 8. The tax authorized to be collected as per section 65(105)(zzm) of Finan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... port management. Having created a statutory authority, it was also incumbent upon the statute to contain the scope of the functions of the authority. Hence the specific enumeration of role and responsibility in section 12 of the Airport Authority Act, 1994. Despite the grant of financial autonomy the need for dependence on the State exchequer could not be eliminated and hence appropriate types of levies as well as restrictions on their utilization were incorporated in the statute. To be noted in particular was the control imposed on the collections that do not relate to commercial operations. The provisions of section 22 and 22A of the Airport Authority Act, 1994 should be viewed in the specific context of substitution of the constitutional funds of the Government of India for deposit and drawal with that of the accounts of the Authority. 12. Section 22 of the Act enables the airport authority to charge users of its facilities. We have noted supra that this provision was never invoked for passengers and payments were restricted to and only upon exercise of option to procure food and non-food articles from licencees situated in the airport premises. On the other hand, the levy ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to provision of service and hence not liable to service tax. The Hon ble High Court of Kerala had observed thus: Even though Airport is also rendering services to the passengers like restaurants, Air conditioning, facility for foreign exchange transactions by allowing Branches of Banks and other dealers to operate, duty free shop for incoming and outgoing passengers to purchase articles etc., service tax can be demanded for such services only when Airport collects service charge for any of the services rendered by them. A Single Judge of this court in the judgment reported in a batch case namely, OP. No. 13451/1996 and connected cases held that similar fee collected by the Kozhikode Airport Authority is without any justification. Even though appeal was filed against the said judgment before the Division Bench, we are told that the Calicut Airport discontinued collection of users fee. Following this, the respondent also has stopped collection of users fee. The facts and circumstances of the case and the evidence clearly prove beyond doubt that the users fee collected is only for enhancing the revenue of the Airport and not for any service rendered to outgoing internatio ..... X X X X Extracts X X X X X X X X Extracts X X X X
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