ORDER
D.N. Panda, Member (J)
1.1 The Appellant challenged the impugned order which held transportation of crude oil through pipeline made by the Appellant for ONGC relating to the period January, 2000 to March, 2005 was clearing and forwarding services rendered to the service taker and similarly service rendered by the Appellant through pipeline transportation of crude oil to Bongaigaon Refinery and Petrochemicals Ltd. (BRPL) was “Business Auxiliary Services” rendered by the Appellant relating to the period September, 2004 to March, 2005. The impugned order dated 30th December, 2005 levied services and educational tax on the considerations received from both service takers as well as penalty levied under Section 75A, Penalty under Section 76, penalty under Section 77 and penalty under Section 78 of the Finance Act, 1994.
1.2 The ld. Adjudicating Authority on examination of the material, was of opinion that below described services were rendered by the Appellant to ONGC and realised three distinct charges from them. Those were transportation charges, conditioning charges and tank charges for the services so rendered. Nature of services which were subject matter of adjudication order was:
(i) Proper upkeep and maintenance of the crude oil received from M/s ONGCL for the purpose of consigning the same to different customers of M/s ONGCL.
(ii) Storing of the crude in the storage tanks, after obtaining necessary clearance and taking delivery thereof from M/s ONGCL.
(iii) Conditioning the crude for attaining pumpable fluidity during winter season.
(iv) Effecting or causing dispatches/supplies of the crude of M/s ONGCL to the buyers as per intimation of M/s ONGCL.
Appreciating nature of services as mentioned above to be classifiable under the category of “Clearing and Forwarding Agency”, service tax and educational tax was levied.
1.3 So far as service rendered by the Appellant to BRPL was concerned, the ld. Authority below relying on an agreement executed between the parties on 17.4.03 found that crude oil of certain quantity was transported by Appellant through pipe line terminal from Barauni to its refinery at Dhaligaon and such service rendered by Appellant to BRPL was in input service classifiable under the category of “Business Auxiliary Services”. Hence the demand arose by the impugned order.
2.1 Ld. Counsel, Shri Ravi Raghwan, appearing for the Appellant submitted that there is no dispute about providing services by Appellant to ONGC and BRPL through pipeline. But what that brings a difference is the nature of service which does not subscribe to view of ld. Adjudicating Authority for assessing the Appellant under the category of “Clearing and Forwarding Agency and as “Business Auxiliary Services” to ONGC and BRPL respectively when there was no law to hold against the Appellant. He submitted that Legislature brought out a specific entry w.e.f 16.6.05 to bring transport of goods through pipeline or other conduit to the purview of service tax incorporating a new Sub-clause (zzz) to Section 65(105) of the Finance Act, 1994. Therefore, according to him, when there is a specific entry, which is the expression of legislative intent that did not intend such new service taxable prior to incorporation of the new entry. According to him, Board vide its Circular No. BI/6/2005-TRU dated 27.7.05, clarified intention of incorporation of Sub-clause (zzz) to Section 65(105) of Finance Act, 1994 conveying in Para 5.1 of the Circular, as under:
5.1 Transportation of goods, other than water, through pipeline or conduit is generally employed to transport petroleum and other petroleum products, natural gas, LPG, chemicals, coal slurry and other similar products. Such transport services are liable to service tax under Sub-clause (zzz) of Section 65(105) of the Finance Act, 1994. Consideration for the said transportation service provided may be payable periodically or from time to time. The service provider is required to pay service tax as and when payment is received for the services provided or to be provided.
2.2 He, therefore, submitted that nature of service of transportation of crude oil through pipeline shall not be clearing and forwarding agency service by any stretch of imagination. Also he submitted that similar such services cannot be taxed on the ground that different charges were realised under different heading when entire consideration received, related to transportation of crude oil through pipeline only. Service rendered to BRPL cannot be Business Auxiliary Service for a clear intention of Legislature conveyed by Board’s Circular above. None of the ingredients of Section 65(19) of Finance Act, 1994 defining the terms of “Business Auxiliary Service” attracted service rendered by Appellant to be taxable by the impugned order. He also submitted that the order of adjudication is also time barred. In support of his contentions, he relied on the following decisions:
(i) Glaxo Smithkline Ltd. v. CCE 2006 (3) STR 711
(ii) Bhagyanagar Services v. CCE 2006 (4) STR 22
(iii) EV Mathai & Co v. CCE 2006 (3) STR 116
(iv) BS Refrigeration Ltd. CCE 2006 (4) STR 103
(v) SB Construction Co. v. UOI 2006 (4) STR 545 (Raj.)
(vi) CCE v. MRF Ltd. v. CCE 2006 (3) STR 434
(vii) Roots Multiclean Ltd. v. CCE 2006 (1) STR 17
He, therefore, prayed that the order of adjudication being misconceived is liable to be set aside.
3. Ld. Counsel, Shri R.K. Chowdhury, assisted by Shri B.N. Pal, ld. Advocate appearing for Revenue, argued that a new entry coming into force from 16.6.05 cannot be of any assistance to the Appellant for nature of activity rendered by them being clearing and forwarding agency so far as ONGC is concerned and Business Auxiliary Services so far as BRPL is concerned. The service rendered to ONGC was fully in connection with transport as a clearing and forwarding agent directly or indirectly for movement of goods from one place to other. Similarly, Business Auxiliary Service rendered to BRPL was without dispute of the fact that Appellant had also rendered conditioning services by providing tanker, heating facilities, laboratory etc. That service not being connected to transport that was rightly categorized as Business Auxiliary Services by Revenue. So far as limitation is concerned, the Appellant failed to file return in time. They automatically invited proceeding that was well within limitation. He relied on the Tribunal’s decision in the case of India Japan Lighting Pvt. Ltd. v. Commr. of Central Excise, Chennai 2007 (218) ELT 103 (Tri.-Chennai).
4. Heard both sides and perused the case records.
5. It is settled principle of law that there is no intendment nor equity about tax. Every subject is taxed by specific letters of law. From 16.6.05 incorporating Sub-clause (zzz) to Section 65(105) of Finance Act, 1994, transport through pipeline was brought to ambit of tax. Transport of crude oil through pipeline having been brought to tax specifically w.e.f. 16.6.05, taxation thereof prior to enactment of law is inconceivable. In view of our observations and view conveyed through Board Circular and considering the enactment as above, we are of view that the impugned order has no legs to stand. Accordingly, other points canvassed by both parties and citations relied upon by them do not call for determination. The Appellant therefore succeeds and Appeal is allowed, setting aside the order of adjudication.
(Operative part of the Order was pronounced in the open Court on 18.2.08)