Service Tax
TRT-2025-
Cestat Ahmedabad
Date:-28-11-22
In:-
Issue Favourable to Tax Payer ?:-
Order date – 28 November 2022
Facts –
- The Appellant M/s. Gautam Freight Private Limited is engaged in providing the export Cargo Handling Service during the period June-2005 to September-2005. They have paid the Service Tax on such services and have availed Cenvat credit of the Service Tax paid on relevant input services.
- As per the definition of Cargo Handling Service as defined as Clause (23) of Section 65 of the Finance Act, 1994. The Cargo Handling of export is excluded from the definition of Cargo Handling Service. Accordingly, it is the contention of the Revenue that since the appellant’s output activity i.e. Cargo Handling of export cargo is not a taxable service, the appellant is not entitled for Cenvat credit of input service used for such non taxable service.
- Aggrieved appellant had filed an appeal.
Issue –
- Whether the service provided by the appellant within the port area is classifiable under Port service or Cargo Handling Service during the relevant period?
Order –
- The Tribunal finds that the Cenvat Credit was denied by the adjudicating authority only on the ground that the same was utilized for payment of service tax on Cargo Handing Service in respect of export of Cargo which is excluded from the definition of Cargo Handling Service under Finance Act, 1994. Therefore, when the output service is not taxable Cenvat Credit was not admissible.
- The Tribunal also find that even though the export Cargo Handling Service is not taxable but the appellant have admittedly paid the service tax and the same was accepted by the department as no objection was raised regarding the payment of service tax.
- It is apparent from the chart submitted by the appellant that he have paid more amount of service tax as against the input tax credit, therefore, there is revenue-neutral situation in the present case, and however, this worksheet was given the first time before this Tribunal which needs to be verified.
- The Tribunal relied the judgment in the Gateway Distriparks Ltd_Vs. CCE, Raigad-2019 (28) GSTL (135) (Tri.,-Mumbai) held that the Cenvat credit is available in respect to the input service used in the non-taxable output service on which the service tax paid.
- Hence it was held that the matter needs to be re considered in the light of the above observation as well as the judgment on the identical issues.
- Accordingly set aside the impugned order and remand the matter to the adjudicating authority for passing a fresh order.
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