Storage and warehousing service
CESTAT,
MUMBAI Bench
Maersk
v.
Commissioner
of Central Excise, Raigad
Ms.
Jyoti Balasundaram, Vice President
And
A.K. Srivastava, Technical Member
Order
No. S/43/08/WZB/CSTB/C-I
Application
No. ST/S/1779 of 2007
In
Appeal No. ST/191 of 2007
January
9, 2008
Section 65 of the Finance Act, 1994 - Storage and warehousing service
- Assessee was providing services at Container Freight Station (CFS) in respect
of both export as well as import cargo - It discharged service tax on import
cargo under ‘cargo handling service’ and no service tax was paid in respect of
export cargo as it was specifically excluded from definition of ‘cargo handling
service’ - Commissioner in its impugned order demanded service tax from
assessee under category of storage and warehousing service for providing
storage of export goods to one of its clients - However circular F.No.
B11/1/2002-TRU dated 1-8-2002 clarified that services provided in relation to
any cargo which was ment for export
would not be taxable and activity of storage of export cargo were part and
parcel of main activity of cargo handling service - Whether prima facie
storage service provided assessee was one of elements of providing ‘ cargo
handling service’ through CFS - Held, yes - Whether, therefore, assessee had
made out a storage prima facie case for complete waiver of predeposit of
service tax and penalties imposed - Held, yes
[Para 14]
Circular & Notifications:
Circular F No.B11/1/2002-TRU dated 1-8-2002.
The Commissioner vide the impugned order held the services rendered by assessee for providing storage of export goods to ‘M’ Ltd. would be covered under category of storage and warehousing service. He accordingly confirmed demand of service tax alongwith penalties.
On appeal:
The services provided by the assessee at the CFS were in respect of both export as well as import cargo. While the assessee was currently levying and paying Service Tax on services provided in respect of import cargo, it was not levying and paying service tax on services provided in respect of export cargo in accordance with the specific exclusion from the definition of ‘cargo handling services’.
The ratio of the decision CCE v. Dr. Lal Path Lab (P) Ltd.
[2007] 11 STT 307 (Punj.&Har.) seemed to be equally applicable to the
assessee’s case, Prima facie, the storage and warehousing services
provided by the assessee within the CFS should be regarded as ‘in relation to
the cargo handling services’. [
Further the circular F.No. B11/1/2002-TRU dated 1-8-2002 clarified that
the service provided in relation to ay cargo which was meant for export would
not be taxable. It also clarified that the activities such as storage,
processing charges, demurrage and transportation and transshipment of export
cargo are part of parcel of the main activity of ‘cargo handling service’. [
Prima facie, it was found that storage services provided by the
assessee was one of the elements of providing ‘cargo handling services’ through
the CFS. [
Following the ratio of the decision in the case of CCE v. Dr.
Lal Path Lab (P.) Ltd. (supra) and in the light of the above prima facie
findings as referred to above, it was viewed that the assessee had made out a
strong prima facie case for the complete waiver of the pre deposit of
the Service Tax and penalties imposed.
Hence pre-deposit of service tax demanded and penalties imposed were to
be waived and recovery there of was to be stayed. [