MAZGAON DOCK LTD. Vs. COMMISSIONER OF SERVICE TAX

JUDGEMENT

(1.) THIS appeal is filed against Order -in -Appeal No. BR(25)25/STC/2005 dated 9.9.2005, vide which the learned Commissioner (Appeals) has upheld the order of the adjudicating authority that the appellant is covered under the service of "Port Services" and upheld the confirmation of demand and imposition of penalties.

(2.) THE relevant facts that arise for consideration are that the appellant herein was providing services of chipping, painting and repairing of ships and vessels under authorization of Mumbai Port Trust under Dry Dock Licence No. 336 dated 1.7.2004, which appeared to fall within the meaning and definition of 'Port Services' under Section 65(67) of the Service Tax Act. These activities were carried out in the premises of the appellants and in the case of inadequacy of facility in their premises, they carried out these activities in the premises of Mumbai Port Trust. The premises of the appellant are situated in the jurisdiction of Mumbai Port Trust and are leased out to the appellant by the Trustees of Board of Mumbai Port Trust.

(3.) AFTER investigation, the authorities below came to the conclusion that the appellant had erred in not taking out the licence and registration of the Service Tax and did not discharge the Service Tex liability. Show cause notices were issued to the appellant to show cause as to why Service Tax amounting to Rs. 617,97,695/ - should not be demanded and recovered under the various provisions of Finance Act, 1994 and to show cause as to why penalty be not imposed and recovery of interest at the applicable rate. The appellant contested the show cause notice mainly on the ground that they are not covered under the category of service "Port Services", basically on the ground that their services are covered under repairs and maintenance and they did not render any other service other than repairs and maintenance. The adjudicating authority did not accept the contention and confirmed the demand and also imposed penalty and sought to recover interest from the appellant. On an appeal, the learned Commissioner (Appeals) also came to the conclusion that the activities, which are carried out by the appellant as regards chipping, painting and repairing of ships and vessels will be considered as "Port Services" as the appellants are working under authorization of Trustees of Mumbai Port Trust. After coming to such conclusion, he upheld the impugned order on all counts. The appellants are in appeal against the said order.