CESTAT,
New
v.
Commissioner
of Service Tax, Mangalore
Dr.
S.L. Peeran, Judicial Member
and
T.K. Jayaraman, Technical Member
Final
Order No. 1020 of 2007
in
Appeal no. st/120 of 2006
september 3, 2007
PORT SERVICE
Section 65 of the Finance Act, 1994 - Port service - Period July 2001
to March 2004 - Assessee-port trust had its railway yard and sidings - Railways
collected from users of yards charges on behalf of assessee and remitted same
to assessee - Whether since railway siding charges collected for use of
infrastructure put up by assessee were not in relation to vessels or goods and
assessee also did not collect these charges from users, these charges did not
represent money received by assessee for port service rendered by it - Held,
yes - Whether, therefore, demand of service tax from assessee-port trust in
respect of railway siding charges was not in accordance with law - Held, yes
[Para 4.2]
>> FACTS
The assessee had its port
railways yard. The Railway collected railway siding charges from the users and
remitted the same to the assessee. The revenue proceeded against the assessee
on the ground that it did not discharge the service tax liability on the
railway siding charges received by it for the period from July 2001 to March
2004. The adjudicating authority confirmed the demand of service tax under
category of port service. The Commissioner (Appeals) also upheld the order of
the adjudicating authority.
On appeal:
>> HELD
The railway siding charges
were received from the Railways by the assessee towards utilization of the port
railway yard on which railway sidings had been
constructed. The Railways collected these charges on behalf of the assessee and
paid these charges to them. Therefore, it was very clear that these charges did
not represent the money received by the assessee for any services rendered by
it. Alternatively, it could not be held that the railway siding charges had
been received for port services rendered by the assessees.
The agreement related to the collection of railway siding charges by Railways.
Moreover, the Commissioner himself had stated that these charges were different
from railway haulage charges, which are included in the charges relating to
port services. Further, there was no strong reasons
for invocation of longer period and there was no proof for suppression
information by the assessee. The railway siding charges collected for use of
the infrastructure put up by the assessee were not in relation to vessels or
goods. The assessees also did not collect these
charges from the users. In these circumstances, demand of service tax in
respect of the railway siding charges was not in accordance with law. The
impugned order had no merits. Hence, the appeal was to be allowed. [
V. Raghuraman for the Appellant. Smt. Sudha
Koka for the Respondent.
nn