Maa Kalika Transport Private Limited Vs Commissioner of CGST & Central Excise (CESTAT Kolkata)
CESTAT Kolkata held that there was no proposal to demand service tax under ‘Cargo Handling Service’ in the Notice, however, in the impugned order the adjudicating authority classified the services under ‘Cargo Handling Service’. Hence, adjudicating authority has travelled beyond the scope of the Notice, which is legally not sustainable.
Facts- M/s Maa kalika Transport Pvt. Ltd.,(The Appellant) was issued a Show Cause Notice dated 30.12.2020, demanding service tax of Rs.9,50,54,524/- for the period from 01.04.2015 to 31.03.2016, under the category of ‘Cargo Handling Service’. The said Notice was adjudicated vide Order-in-Original, wherein the Ld. Commissioner has confirmed the Service Tax demand Rs.9,50,54,524/-including Cess along with interest and imposed penalty of Rs.9,50,54,524/- u/s. 78(1) of the Act and penalty Rs. 10,000/- u/s. 77(2) of the Act. Aggrieved against the impugned order, the Appellant has filed the present appeal.
The Appellant stated that they bonafidely believed that the service rendered by them are “Transportation Services”, where service receivers are liable to pay service tax. Accordingly, they have not collected service tax from their customers.
Conclusion- Held that the Appellant was not providing any of the services which fall under the category of ‘Cargo Handling Agent Service’. Further, we observe that there was no proposal in the Notice to categorize the service rendered by the Appellant as ‘Cargo Handling Agent service’. In the impugned order, the adjudicating authority classified the services under the category of Cargo Handling agent Service’ on his own. Thus, we observe that the adjudicating authority has travelled beyond the scope of the Notice, which is legally not sustainable.
Held that there was no clarity on the classification of the service even within the department. Accordingly, following the above cited decision of the Hon’ble Supreme Court, we hold that there is no suppression of fact involved in this case. Consequently, extended period cannot be invoked to demand duty.
FULL TEXT OF THE CESTAT KOLKATA ORDER
M/s Maa kalika Transport Pvt. Ltd.,(The Appellant) was issued a Show Cause Notice dated 30.12.2020, demanding service tax of Rs.9,50,54,524/- for the period from 01.04.2015 to 31.03.2016, under the category of ‘Cargo Handling Service’. The said Notice was adjudicated vide Order-in-Original dated 10.12.2021, wherein the Ld. Commissioner has confirmed the Service Tax demand Rs.9,50,54,524/-including Cess along with interest and imposed penalty of Rs.9,50,54,524/- under Section 78(1) of the Act and penalty Rs. 10,000/- under Section 77(2) of the Act. Aggrieved against the impugned order, the Appellant has filed the present appeal.
2. In the instant case, the Appellant claimed that they have provided “Transportation of Coal Services” upto a distance of 200 km against various work orders, on collection of total value of Rs.65,56,50,736/-. The details of such work orders executed by the Appellant during the relevant period are furnished below:
