THIRD MEMBER ON REFERENCE : MS. ARCHANA WADHWA, MEMBER (J)] GUJARAT CHEM. PORT TERMINAL CO. LTD. Vs. C.C.E. & C., VADODARA-II

JUDGEMENT

(1.) THIS appeal is directed against the order -in -appeal dated 29 -7 -2004 which upheld the order -in -original that confirmed the demand and also imposed penalties on the appellants.

(2.) THE relevant facts that arise for consideration are that the appellant is registered as minor port and is rendering the port services. On the basis of some intelligence officers of Central Excise and Service Tax visited the premises of the appellant and after investigation came to the conclusion that during the period 16th August 2002 to 30th June 2003, appellant had rendered services falling under the category Storage and Warehousing Services and are liable to pay service tax on the said services. A show cause notice was issued to the appellant demanding the service tax and also proposing for imposition of penalty on them. Appellant contested the said show cause notice on the ground that they are registered as a minor port with the authorities and as such are providers of the port services and are not rendering any services of storage and warehouse. The said contentions were not accepted by the adjudicating authority and the demand of service tax was confirmed and penalties were imposed. On an appeal the learned Commissioner (Appeals) concurred with the findings of the adjudicating authority. The appellants being aggrieved by such order are in appeal.

(3.) THE learned advocate appearing for the appellant submits that the impugned order is not correct. It is his submission that the services provided by the appellant in this case will not fall under the category of Storage and warehousing services for the reason that the appellant is registered as minor port and started operation in the month of January 2001. It is the submission that the appellant has always projected themselves as minor port and the incidental storing and warehousing of the imported goods and/or goods to be exported are connected with the activity of the port services rendered by them. It is his submission that the clarification dated 1st August 2002 issued by the Department of Revenue would also indicate that the storage and warehousing facility of the ports will be covered in the category of Port services and not under storage and warehousing services. It is also his submission that since the port services provided by the minor ports came in to the service tax net from 1st July 2003, the services tax liability to the period earlier under any other category would not arise. It is also his submission that the tax liability in this case has also been worked out the amounts that were not received by them from their customers. It is his submission that the appellant as per contractual obligation issued invoices to the promoters of the appellants port for non -fulfilment of committed tonnage but the appellant did not receive the amounts so billed and hence the tax liability on such amount is not -sustainable. It was also submitted that the show cause notice is time barred in as much that the appellant had intimated the department that they are providing the storage facility to the importer and exporters for the usage of their ports on 18th March 2002 itself and the lower authorities have not considered the said submissions in proper perspective. It was also submitted that, the service tax liability is worked out wrongly in as much that the tax is charged on the entire amount of the bill while the billed amount should have been considered as inclusive of service tax, if any.