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April 2011

(2011) 21 STR 353 (SC) – P. C. Paulose, Sparkway Enterprises vs. CCEx.

By Puloma Dalal, Jayesh Gogri, Chartered Accountants
Reading Time 1 mins
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An Agent appointed by Airport Authority of India for collection of admission charges is considered a provider of airport services – u/s. 65(105)(zzm), the assessee is liable to discharge service tax.

Facts:
The appellant entered into a license agreement with the Airport Authority of India (AAI) under which they were authorised to collect airport admission ticket charges and were granted space at the airport. All the expenses to provide services to passengers and visitors were to be borne by the appellant. Moreover, the appellant had to bear all rates, outgoings taxes etc. The revenue contended that as per the statutory definition of Section 65(105) (zzm) of Finance Act, 1994 and circular dated 17.09.2004, the appellant was responsible to discharge service tax liability whereas, the appellant were of the view that AAI, being the principal service provider, was liable for service tax.

Held:
The appellant is authorised by the Airport Authority of India to provide services and therefore, it steps into the shoes of the Airport Authority of India and is liable to pay service tax.

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