Key Points

The appeal, filed under Section 35L of the Central Excise Act, 1944, challenged the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) ruling that confirmed AAI’s service tax liability under the category “airport services” with effect from September 10, 2004.

AAI had argued that services related to handling of export cargo are excluded under the Finance Act, 1994, placing reliance on Section 65(23), which defines “cargo handling service.”

In its judgment, a Bench of Justices Pankaj Mithal and Prasanna B. Varale noted, “The definition of taxable service read with sub-clause (zzm) means any service provided or to be provided to any person, by Airports Authority or by any other person in any airport or a civil enclave.” “All kinds of services rendered by the Airports Authority in any airport are taxable services and are chargeable to service tax under Section 66 of the Act,” it said.

Addressing AAI’s claim regarding export cargo, the Justice Mithal-led Bench observed, “The definition of ‘cargo handling service’ includes various kinds of services rendered at the airport, but it specifically excludes ‘handling of export cargo’. Thus, ‘handling of export cargo’ stands excluded from the ‘cargo handling service’, but that by itself would not be sufficient to exclude it from the definition of taxable service under Sub-section (105) of Section 65 of the Act.”

The apex court also dismissed reliance placed by AAI on various circulars, observing that “they are merely circulars and cannot override the express statutory provisions.”

Concluding the judgment, the Justice Mithal-led Bench observed, “Accordingly, we are of the opinion that the CESTAT or the Authorities below have not erred in taxing the services rendered by the appellant in relation to export cargo as 8 taxable service under sub-clause (zzm) of Sub-section (105) of Section 65 of the Act with effect from 10.09.2004. The appeal, as such, lacks merit and is, accordingly, dismissed.”

- IANS