Services of mining, loading, transportation and unloading — Whether cargo handling service or goods transportation service — Since tax paid as receiver of GTA service — Contract indicated small component of loading and unloading — Handling or transportation within factory or mining area does not amount to ‘cargo’ is well settled — In the contracts of appellants handling is incidental to transportation — Held revenue’s attempt to convert this to cargo handling appears far-fetched — Demand set as<

Services of mining, loading, transportation and unloading — Whether cargo handling service or goods transportation service — Since tax paid as receiver of GTA service — Contract indicated small component of loading and unloading — Handling or transportation within factory or mining area does not amount to ‘cargo’ is well settled — In the contracts of appellants handling is incidental to transportation — Held revenue’s attempt to convert this to cargo handling appears far-fetched — Demand set aside.

The appellant provided integrated services of mining for excavation of bauxite ore, loading it into trucks at stock yards and transportation of the same by road and unloading the same at a specified area for two aluminium companies during August, 2002- March, 2006. Revenue proceeded the case considering this as cargo handling service. From 1-1-2005, the appellant discharged service tax as recipient of GTA service on consideration received for transportation of goods. For services other than transportation. The appellant paid service tax from 16-6-2005 under Business Auxiliary Service as services in relation to production were covered under Business Auxiliary Service. According to the appellant, services covered under mining service were not liable prior to 1-6- 2007. Relying on several decisions including Sainik Mining & Allied Services (2008) 9 STR 531 (Tri.) and Modi Construction (2008) 12 STR 34 (Tri.), the appellant contended that handling of goods within factory or mines could not be considered handling of cargo. The Revenue contended that argument of the assessee that mining was a dominant activity was incorrect and relied in support on Gajanand Agarwal v. CCE, (2009) 13 STR 138.

Held:

The contracts indicated insignificant component of cargo handling service and main activities were mining and transportation. No separate rates were available for loading and unloading as available in the case of Gajanand Agarwal (supra). The Revenue’s attempt to convert such activity from transportation and deny abatement claimed appeared farfetched to find legal support. Loading and unloading combined with transportation service rendered in respect of transportation would not become cargo handling service. The appeal was accordingly allowed.