The Ahmedabad bench of the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) held that the water front royalty charge does not include any services concerning vessels or goods and does not fall under the category of ‘port service’.
State Charges Gog Jafrabad Port, the appellant assessee registered with the Service Tax department under the category of port services and has been paying Service Tax regularly under the port service rendered by them to various clients.
The assessee appealed against the order passed by the adjudicating authority for confirming the Service Tax demand of Rs. 1,52,52,812/-, under Section 73 of the Finance Act 1994.
V.H.P Singh, Jigar Shah and Ambar Kumrawat, the counsels for the assessee contended that the port service” had been defined as “any service rendered within a port or other port, in any manner”.
Also submitted it can be seen that the words “vessel or goods” had been deleted in the amended definition of “port service”.
P K Singh, the counsel for the department relied on the decisions made by the lower authorities and contended that the service tax demand under the category of port service was as per the law and liable to be sustained.
The Bench observed that since the assessee had not provided any service concerning the vessel and goods the charges received by them do not fall under the definition of port service during the period of demand and charges for use of water front royalty do not include any service concerning vessel or goods and therefore same cannot be described as a port service.
The two-member bench comprising Ramesh Nair (Judicial) and C L Mahar (Technical) quashed the service tax demand against the assessee while allowing the appeal filed by the assessee.
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