Airport Services Decided Case laws

Cochin International Airport Ltd. Vs. The Commissioner of Services Tax, Cochin


Service Tax: Airport Services: Royalty from Air India: Services provided to various air lines and other facilities at the airport which needs to be managed by the appellant, has been contracted out to Air India and they have discharged the service tax liability on gross amount collected. This being the factual matrix, the demand of service tax on the royalty charges collected by appellants from M/s. Air India can be construed as an amount for lease or rental charges for functioning in the appellant's area. No service tax liability on amounts collected from M/s. Air India.


Service Tax: Airport Services: Royalty Charges: License Fee: Space allotted on lease inside the airport premises: This would indicate that the licensees i.e. M/s Thomas Cook, Atlas Jewellery etc., have taken the area on lease and as per the CBEC Circular dated 17.9.2009, such charges would not be subject to service tax as the activity of letting out premises is not rendering services. The entire tenor of the agreements entered by the appellant with the other parties clearly speak of letting out/leasing out the space in the Cochin International Air Port for a specified term, renewable or being leased out to any other bidder.


Service Tax: Airport Services: Garbage Disposal Charges: Garbage disposal is collection of garbage like waste material, discarded items scrap from the Air Port premises. Though there is no agreement provided for this, the explanation given by, the appellant in the grounds of appeal indicate that these are nothing but sale of garbage from the Air Port premises. This activity would not be liable to service tax.


 Service Tax: Airport Services: Courtesy coach parking and surcharge on prepaid taxi: There is a clear a finding of the lower authorities that the courtesy coach parking services are services extended to the courtesy coaches, which bring the passengers into the Air Port. As regards income from surcharge on Pre-paid Taxi, this amount is collected by the appellant from the cooperative societies who operate the Air Port taxi services in addition to the charges which are charged by such taxi operators. No justifiable reason for non-inclusion of this amount for discharge of the service tax liability.


Service Tax: Airport Services: Guest Room charges: The guest room charges are realized from the passengers who are accommodated in the guest rooms due to contingencies. This accommodation is provided only to the passengers who have been issued with boarding passes and tickets and this facility is not open to others. The amount so collected would definitely fall within the purview of the services provided under the category of Air Port Services.




Service Tax: Airport Services: Entry ticket charges and issue of commercial passes: These charges are charged by the appellant for restricting the entry to public in to the Air Port. The said income is not in respect of any services rendered by the appellant as an Air Port Authority. This amount collected and shown as income could not be construed as services rendered and liable to service tax.


Service Tax: Airport Services: Penalty: Remand: The service tax liability and the consequent interest liability and penalty charges needs to be requantified by the lower authorities. For the limited purpose of requantification of the service tax liability as per our finding as recorded herein above, the matter is remanded to the lower authorities. After arriving at the correct quantification of the service tax liability the lower authorities will also decide upon the quantum of penalties.