TMI Blog2019 (1) TMI 185X X X X Extracts X X X X X X X X Extracts X X X X ..... vessel and/ or goods only. Thus, this service can be covered under the definition of Port Service. Therefore, the demand in respect of Toll charges and Entry Fees charges is upheld. Demand of service tax - Royalty for containers and Income from 11th and 12th cargo berth - Held that:- Identical matter was decided in the case of Cochin Port Trust vs. CCE, Cochin [2010 (5) TMI 495 - CESTAT, BANGALORE], where it was held that Letting out the port premises for operation by IGTPL does not amount to rendering of port service. In any case, if at all any service tax is paid on this amount, the same would be available to IGTPL as Cenvat credit, which can be used for paying service tax on port services rendered by it - the demand under the head of Royalty for containers and Income from 11th and 12th cargo berth cannot be sustained and is set-aside. Demand of service tax under the head of renting of immovable property services - Township income - Held that:- There is no discussion on the nature of service against which this amount is received, who is the person who paid the amount and what is the arrangement between the appellant and the person paying for such amounts. In these circumsta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ead with Section 78 of the Finance Act, 1994. The show cause notice proposes to recover the service tax under the heads:- (a) Testing charges of bitumen (b) charges for entry permit and toll collection (c) the difference between the value declared under the head Port service viz. the certain specified heads of income shown towards Cargo Handling and Storage charges and Port and Dock charges shown in the books of accounts (d) service tax on miscellaneous income and township income under the head of Port services. 2.1 The show cause notice also seeks to deny Cenvat credit on; (a) Telephone charges installed in the residential premises (b) Construction/ repairing work at staff colony/ quarters (c) Taxi/ bus hiring charges (d) Construction service and transportation expenses without documents. 3. Ld. Counsel pointed out that service tax has been demand on Entry Permit Fee and Toll collection cannot be charged to service tax. He relied on the Circular F. No. 354/27/2012-TRU dated 22.02.2012 therein it has been clarified that service tax is not leviable on the toll charges paid by the users of the road. He pointed out that the Circular has further clarified ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be strictly considered as Toll. Moreover, these charges are paid for using the facility of road and other infrastructure within the Port area and thus, it is not in the nature of Toll Charges. Ld. Counsel sought to argue that these services of Entry Fee/ Toll charges are not in relation to vessels or goods. The ld. Counsel sought to argue that prior to 01.07.2010 the Port Service definition reads as under:- Port Service means any service rendered by a port or any person authorized by the port in any manner in relation to a vessel or goods. After 01.07.2010, the Port Service is defined as under:- Port Service means any service rendered within a port or other port in any manner;. He argued that amended definition cannot be applied prior to the amendment and thus the service in relation to vessels and goods can be covered in Port Service. He argued that entry fees and toll charges are not in relation to vessels or goods. The port services at the relevant time, were described as follows:- Port Service means any service rendered by a port or any person authorized by the port in any manner in relation to a vessel or goods. From the above definitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the notice as to how it is exempted, therefore, I hold that the Sundry Handling income is clearly taxable and is liable to be taxed. We find that reasons given by the appellant was not properly dealt with by the Adjudicating Authority and therefore, the same was not considered and the observations of the Adjudicating Authority against this head are vague and without any authority of law. We find that exact same issue was considered by Tribunal in case of Cochin Port Trust 2011 (21) STR 25 (Tri. Bang.). In the said decision Para 3(ii) details the facts and Para 5.2 gives the observations on the said facts. The same are reproduced below:- 3 (ii) As regards the upfront charges, the Commissioner had failed to appreciate that this amount was paid towards cost and use of appellants equipment. The agreement stipulated a transfer of ownership of the equipment belonging to the appellant upon IGTPL making payment in installments over a period of eight years. As the transaction in question was one of sale and the amount received from IGTPL was part of the sale consideration, there was no justification for imposition of service tax on the said amount. They had pointed out to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e leasehold rights and ownership of crane leased from M/s. ABG Heavy Industries Ltd., was also passed on to the licensee. The consideration received was accounted in the financial records of CPT as sundry debtors and the value of the assets written off at the written down value of ₹ 7.6 crores. Even if the equipment is held to have been leased to IGTPL and not sold, we find that no tax can be levied on the consideration as it is not received towards port services rendered by CPT. Thus relying on the aforesaid decision we do not set-aside the demand on this count. 5.2 The second issue relating to Entry Fee and Toll collection has already been discussed above in Para 3 and therefore demand under this head is sustainable and is upheld. 5.3 The demand under the head of Royalty for containers and Income from 11th and 12th cargo berth are in respect of Revenue share received by the appellant from the income of M/s. ABG Limited and CWC. Ld. Counsel contended that M/s. ABG and CWC are the service provider and have discharged their respective tax liability. He argued that the appellant are only receiving a part of income as Revenue share for permitting M/s. ABG Limited and CW ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... premises for operation by IGTPL does not amount to rendering of port service. In any case, if at all any service tax is paid on this amount, the same would be available to IGTPL as Cenvat credit, which can be used for paying service tax on port services rendered by it. We find this demand not sustainable. Similarly, in the case of Cochin Port Trust vs. CCE, Cochin 2011 (21) STR 25 (Tri. Bang.) the Tribunal observed as follows:- 5.1 The impugned demands are under port services rendered by CPT. The relevant entry in clause 82 of Section 65 of the Act read as under during the period of dispute : Port service means any service rendered by a port or other port, or by such port or other port, in any manner in relation to a vessel or goods. The royalty amounts were paid by IGTPL @33.33% of its gross revenue under its agreement with CPT. This amount was paid by IGTPL to CPT for allowing it to develop and operate Rajiv Gandhi Container Terminal at the port premises. We do not find any logic in treating CPT allowing IGTPL, to develop and operate the container terminal as an activity falling under port services. The royalty received by the appellant is not a considerati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his amount is received, who is the person who paid the amount and what is the arrangement between the appellant and the person paying for such amounts. In these circumstances, we find that the impugned order is not a speaking order on this issue and therefore, the same needs to be set-aside and issue needs to be remanded for determining the exact grounds and arguments on the basis of which the demand under the head of township income was confirmed. 7. Next issue relates to Cenvat credit availed by the appellant which is sought to be denied. The impugned order seeks to deny Cenvat credit on the input service of Telephone used by various officers installed at their residential premises. The impugned order relied on the CBEC clarification to hold that the Cenvat credit is admissible only in respect of telephone service if the same are installed in the office premises. In the appeal memorandum, it has been argued that only the specific amount of ₹ 385/- per month is reimbursed to certain officer (except HODs). In case of HODs the actual amount is reimbursed. He argued that the Port operates round the clock and the officers are required to remain in touch all the time. It was a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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