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2024 (5) TMI 723 - CESTAT MUMBAILevy of service tax - Business Auxiliary Service - freight margin recovered by the noticee from their customers - intermediary services or not - place of provision of services - invocation of extended period of limitation - HELD THAT:- From plain reading of the legal provisions relating to ‘Place of Provision of Services Rules, 2012’ it clearly transpires that the place of provision of service in general has been specified under Rule 3 ibid, and in specific situations such as place of provision of performance-based services, provision of services relating to immovable property, provision of services relating to events, services provided at more than one location, services where provider and recipient are located in the taxable territory, provision of certain specified services have been specifically categorized and the place of provision in such cases have been given in the respective Rules 4, 5, 6, 7, 8 and 9 ibid respectively. As regards the place of provision for goods transportation services, other than by way of mail or courier, it is specifically stated as the ‘place of destination of the goods’ under Rule 10 ibid. Considering the above legal provisions, in the present case, it is found that since the services are provided in respect of transportation of export goods, on the ocean voyage for delivery at the port of destination abroad, which is out of ‘taxable territory’, the services provided by the appellant cannot be covered under the service tax net, in the post negative list regime after 01.07.2012 also in terms of Section 66B ibid. Further, the findings given in the impugned order for rejecting application of Rule 10 ibid is on the ground that Rule 8 shall apply in the present case, as both service provider and recipient of the service are located in the taxable territory. In this regard it is found that, Rule 14 ibid specifically state thatnotwithstanding anything stated in any rule,where the provision of a service is, prima facie, determinable in terms of more than one rule, it shall be determined in accordance with the rule that occurs later among the rules that merit equal consideration. Thus, in terms of non-obstante clause which grants superimposing authority to Rule 14 ibid over the provisions of other rules, in terms of the rule that occurs later would be applied and accordingly Rule 10 ibid is the correct one to be applied in the present case. The issue of service tax liability in respect of freight charges of cargo/container space has already been dealt in elaborately by the Tribunal in the case of GREENWICH MERIDIAN LOGISTICS (INDIA) PVT. LTD. VERSUS COMMISSIONER OF SERVICE TAX MUMBAI [2016 (4) TMI 547 - CESTAT MUMBAI] holding that the service tax is not applicable on such freight element. The impugned order dated 05.04.2019 with regard to confirmation of adjudged service tax demands along with interest and penalties are not sustainable - Appeal allowed.
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