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2016 (42) S.T.R. 111 (Tri. - Del.

Justice G. Raghuram, President and Shri R.K. Singh, Member (T)
Stay Order Nos. ST/S/50326-50328/2015-CU(DB), dated 20-1-2015 in Application Nos.
ST/Stay/59660 & 59662-59663/2013-CU(DB) in Appeal Nos. ST/59012 & 59014-59015/2013CU(DB)
Stay/Dispensation of pre-deposit - Mining services vis--vis Goods Transport Agency service
(GTA) - Appellant providing service of transportation of coal from quarries/bunkers/surface, etc.,
to railway sidings/dumps/ stock yards, etc., within mining area - Prima facie said activity
amounting to GTA services and not mining services - Service recipient already paid Service Tax
on GTA charges under reverse charge mechanism - C.B.E. & C Letter F. No. 232/2/2006-CX.4,
dated 12-11-2007 also favouring appellants case - Stay granted by fully waiving pre-deposit of
all dues - Section 35F of Central Excise Act, 1944 as applicable to Service Tax vide Section 83
of Finance Act, 1994. [para 3]
Stay granted
C.B.E. & C. Letter F. No. 232/2/2006-CX-4, dated 12-11-2007

[Para 3]

Shri A.K. Batra, CA, for the Appellant.

Shri Amresh Jain, DR, for the Respondent.

[Order per : R.K. Singh, Member (T)]. - The stay applications along with appeals have been
against respective Orders-in-Original in which service tax demands along with interest and
penalties have been confirmed. As the issue in all the three cases is the same, the stay
applications are being disposed of by a common order.

2.The appellants had entered into two agreements, one of which was for transportation of coal
from coal quarries/faces/bunkers/surface, etc., to various railway siding/dumps/stock yards, etc.,
within the mining areas. The service tax has been demanded treating this activity as mining
service. The appellants have contended that the service clearly falls in the scope of GTA service
and the service recipient, [M/s. South Eastern Coal Ltd. (SECL)] is paying service tax
accordingly under reverse charge mechanism.
3.We have perused the relevant agreements. They are essentially for transportation of coal
after the same has been extracted. Therefore prima facie the activity would fall under the scope
of GTA and not under the scope of mining service. The fact that the service recipient, namely,
SECL, has already deposited the service tax for this service under GTA service under reverse
charge mechanism further strengthens the contention of the appellants. Indeed the C.B.E. & C.
Circular No. 232/2/2006-CX-4, dated 12-11-2007 (in para 05) states as under : 05.Handling and transportation of coal/mineral from pithead to a specified location within the
mine/factory or for transportation outside the mine;
These activities are post-mining activities and are chargeable to service tax under the relevant
taxable services, i.e., Cargo Handling Service and Goods Transport by Road. However, in
case, such transportation is undertaken by mechanical systems, such as conveyor belt system,
ropeway stem, merry-go-round system, etc. and the same is not transported by road, no service
tax would be chargeable. Service tax is, however, chargeable under cargo handling service, even
if the loading, unloading and similar activities are done using mechanical systems.
Thus, prima facie the C.B.E. & C. also did not consider the impugned service to be mining
4.In the light of the foregoing, we are of the view that the appellants are able to make out a
good case for waiver of pre-deposit and we order accordingly staying recovery of the impugned
liabilities during pendency of the appeals.