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TMI Blog2017 (5) TMI 149X X X X Extracts X X X X X X X X Extracts X X X X ..... contract with major customers such as M/s Food Corporation of India, M/s FACT, M/s. Indian Potash etc for rendering import and export services. As part of the Turnkey contracts, the appellant rendered a basket of services to their customers including clearances of import cargo by filing Bills of Entry, seeking plant quarantine clearance, discharge of cargo from ship, packing and standardization, reaching and stacking, loading of cargo into containers, transportation to railway siding and loading into wagons etc. For such services, the Turnkey Contract provided for payment of a certain amount per tonne including charges for all services. The appellant was discharging the service tax in the category of CHA services on 15% of the amount recei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dually listing out all the various charges. The ld. Commissioner in the impugned order has referred to the Circular No. 119/13/2009-ST dated 21.12.2009 and has held that since the payments received by the appellant were not as lumpsum, the benefit of 85% abatement cannot be extended to the appellant. 3. In the impugned order, the following amounts have been confirmed: i. An amount of Rs. 1,58,12,232/-, has been demanded being the service tax short paid for the services as CHA and Education Cess of Rs. 1,42,057/-; ii. An amount of Rs. 2,30,08,371/- being service tax on Port Services and Education Cess of Rs. 3,11,158/-. iii. Penalty of Rs. 3,92,73,818/- under Section 78 of the Finance Act, 1994 in addition to penalty under Sections 76 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or CHA services and the balance is towards reimbursement of other expenses incurred on behalf of the importer. In terms of the TRU Circular of 1997, the appellant has discharged the service tax on 15 per cent of the total consideration received. If they were to discharge the service tax only on Agency Commission, the same would amount to a much lesser amount. Consequently, he submitted that the demand for service tax raised on this ground is not justified. 8. Ld. DR, on the other hand, reiterated the impugned order. He submitted that paragraph 17 of the impugned order clearly brings out the various services rendered by the appellant. He further submitted that the appellant was authorized to carryout various operations within the port area ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ization by port. The definition of port services under Section 65(82), the same is reproduced below: "Port Service means any service rendered by a port or other port or any person authorized by such port, in any manner, in relation to a vessel or goods." 12. We find that the above issue stands settled in favour of the appellant in many cases. In the assessee s owned case dealing with their operation in Mangalore Port, the Tribunal has decided the issue in 2011[21 STR 257 Tribunal Bangalore] as follows: "17. It can be seen from the above reproduced ratio of the judgment of the Tribunal in the case of Velji P. & Sons (Agencies) P. Limited that the facts of that case and the facts in these cases before us are identical wherein various ser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n admitted fact that the relevant period in all these cases is prior to 08.05.2010. Hence, the contentions raised by the counsels for all the appellants that the Finance Act, 2010, has removed the lacuna in the earlier port services, is correct". 18. Hence, in view of the foregoing reasoning s, on the merits of the case whether all the services rendered by the appellants would fall under the category of Port Services or not, we hold that the services rendered by the appellants would not fall under the category of Port Services . As the impugned orders are set aside on merits, there can be no case of penalty or interest in respect of this issue". 13. The above view has been reiterated in the case of HML Agencies (Supra). By following the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... total amount received is to Rs. 388 per MT, the amount pertaining to agency Commission is only Rs. 3 PMT and the balance is towards reimbursement of other expenses incurred on behalf of the client. They have further submitted that the service tax already stands discharged on 15% of the total consideration received, which would amount to much more than that payable if only the Agency Commission is considered for payment of Service Tax. 16. The Service Tax payable on Custom House Agent Service is only on the agency commission charge for such services. Reimbursement of expenses incurred by the appellant on behalf of the clients cannot be included in the consideration for charging Service Tax. The 1997 of the Circular of the board has been iss ..... X X X X Extracts X X X X X X X X Extracts X X X X
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