TMI Blog2018 (7) TMI 1919X X X X Extracts X X X X X X X X Extracts X X X X ..... rging service tax on different components of the contract individually under different services is not justified. The Tribunal in the case of M/S. HAZARIBAGH MINING ENGINEERS PVT. LTD. VERSUS COMMISSIONER OF CENTRAL EXCISE, CUSTOMS SERVICE TAX, BBSR-I [2016 (12) TMI 1131 - CESTAT, KOLKATA] have considered a similar composite mining contract which was made chargeable to service tax under different categories. The Tribunal held that once the contract is a composite contract for the entire activities from site formation to segregation of ores then the same has to be charged as a separate service (Mining Services), which was made chargeable to service tax w.e.f 01.06.2007 only. Vivisecting the composite contract and charging servic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tation of ore services to their principal, M/s East India Mineral Limited. The service was provided between 11.3.2002 and 1.1.2005 in terms of a composite contract where rates were fixed on per metric tonne basis for three grades of ore for their mining, loading, transportation and unloading at the factory site of the principal. Transportation, loading and unloading charges were not separately billed. With effect from 1.5.2005, the work contract was bifurcated showing separate rates for two services involved, namely, mining of ore and its transportation upto the factory. Now the two services became liable to separate classification and valuation. The appellants obtained service tax registration on 21.2.2006 under the category of Site For ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his plea. The issue at dispute is therefore one of classification. A pe;rusal of work contract applicable with effect from 1.1.2005 reveals that two distinct services separately billed valued are being provided by the appellants. One is mining of ore and the other is transportation of ore from mine site to factory site. The adjudicator has held that all mining related services amount to business auxiliary service of production of goods for and on behalf of the principal. In a wider sense, production can be treated as inclusive of mining also but the very fact that a separate classification for mining services was provided in 2007 shows that production of goods appearing under the classification of Business Auxiliary Services did n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or categorizing a service as cargo handling, namely, loading/unloading of cargo are not even mentioned in the contract. The adjudicator also appears to have ignored the fact that the service receiver had already obtained service tax registration under the classification of goods transport by road had discharged the duty liability for the period covered in the impugned order. There is no evidence to support a view that value of handling has been suppressed, is being received separately or is not included in the rate contracted for transportation of ore. I therefore hold, keeping in mind provisions of new contract and absence of any other evidence supporting a different view, that the service of transport of ore from mine to factory is ap ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or either for crushing or for transportation of material. It is a composite contract encompassing all the activities listed therein. When the entire scope of the contract is considered, it is evident that this will be covered only within the category of mining which has been included as a separate service w.e.f. 01.06.2007. The Tribunal in the case of the appellant reported in Thriveni Earthmovers Pvt. Ltd. vs. Comm. Of C. Ex. [2009(15) STR 393 (Tri.-Chennai)] has observed that movement of limestone and rejects within the mining area is covered by the entry mining of mineral, oil, gas and cannot be taxed under Cargo Handling Service prior to 01.06.2007. It was also recorded that when the activity was brought under the service tax net wi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... simpliciter without any other element in them, such as for example, a service contract which is a commissioning and installation, or erection, commissioning and installation contract. Further, under Section 67, as has been pointed out above, the value of a taxable service is the gross amount charged by the service provider for such service rendered by him. This would unmistakably show that what is referred to in the charging provision is the taxation of service contracts simpliciter and not composite works contracts, such as are contained on the facts of the present cases. It will also be noticed that no attempt to remove the nonservice elements from the composite works contracts has been made by any of the aforesaid Sections by deducting f ..... X X X X Extracts X X X X X X X X Extracts X X X X
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