TMI Blog2009 (4) TMI 9X X X X Extracts X X X X X X X X Extracts X X X X ..... nes area during the period August 2002 to November 2006 for M/s. Chettinad Cements Corporation [CCC] under an agreement entered into with them. As per the agreement M/s. TEPL received Rs.9/- per tonne towards loading of limestone/rejects and Rs.27.50 per tonne towards transportation of the same. On 1.6.2007 "mining of mineral, oil, gas" was brought under the levy of service tax. The CBEC vide Circular F. No. 232/2/2006 CX-4 dated 12.11.2007 clarified the scope of the new category of service. It was clarified that service tax was chargeable under "cargo handling service" on post-mining activities such as loading, unloading and similar activities though done using mechanical systems. Though TEPL is registered as a provider of service under the category of "mining of mineral, oil, gas" effective from 1.6.2007, a notice was issued to them proposing to recover service tax on the activity of loading and transportation of limestone and rejects mentioned above. Adjudicating the Show Cause Notice the Commissioner demanded an amount of Rs.1,20,26,027/- towards service tax and education cess as well as applicable interest under the relevant provisions of the Finance Act, 1994 (the Act). He al ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing a Show Cause Notice on 24.7.2007 a corrigendum was issued on 22.10.2007 enhancing the amount of service tax proposed to be demanded from Rs.35,36,957/- to Rs.1,30,19,961/-. As both the notices were issued on the basis of same set of facts the second Show Cause Notice could not validly invoke extended period for demanding the differential amount of tax. As confusion existed as to the scope of the levy, CBEC had issued clarifications. Any failure to pay tax for bona fide belief of the appellants that tax was not payable could not be demanded invoking larger period. 3. We have heard both sides. We find that the impugned activity is loading and transport of limestone and rejects from the mine head to the premises were the mined limestone is crushed and that the entire activities take place in the mining area. In CCE Vs. Pyrites, Phosphates and Chemicals Limited - 1983 (12) ELT 537 the Tribunal made the following observations:- "Further we agree with the contention of the respondents to the effect that the premises where the crushing of pyrites is being carried on will fall within the definition of Section 2(1)(j) of the Mines Act, 1952 since the premises are adjacent to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of cargo handling service in relation to loading and transport of coal and iron ore in the mining area respectively in Sainik Mining Allied Services Limited (supra) and CCE Vs. B.K. Thakkar (supra). In the Sainik Mining Allied Services case the Tribunal's has observed as follows:- We find that the activity undertaken by both the appellants for mechanical transfer of coal from the coal face to tippers and subsequent transportation of the coal within the mining area, does not come under the purview of cargo handing service. The dominant activities undertaken by the appellants under the contract in question are primarily the movement of coal within mining area and transfer of coal from the coal face to the tippers, if at all, includes loading and unloading which are merely incidental. Cargo in commercial parlance has a definite connotation which 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 an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ch, in our view, the activities undertaken by the respondents are primarily in the nature of mining activities comprising of excavation, transportation and feeding of iron ores to the crusher plant and even though these activities may incidentally involve some loading and unloading, the same cannot be covered under the category of "cargo handling service" as what is carried cannot be commercially called "cargo" in this case. Consequently, we are of the view that the gross amount received by the respondents from M/s. SAIL cannot be charged to Service Tax under the said heading of "cargo handling services". Hence, we uphold the impugned Order-in-Appeal, but for the different reasons recorded by us above, and we dismiss the Departmental Appeal. The Cross Objection filed by the respondents also stands disposed off. The Tribunal found that the impugned activity in that case comprised excavation, transportation and feeding of iron ores to the crusher plant even though those activities incidentally involved some loading and unloading the same could not be covered under the category of cargo handling service. The above authorities also held that "cargo", in commercial parlance had a defi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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