Smt. Ranjana Desai, J.

The 1st petitioner is the Indian National Ship Owners Association which is registered as a nonprofit making company under Section 25 of the Companies Act, 1956. Members of the 1st petitioner are owners of Indian Flag Vessels. The Shipping Corporation of India (SCI) is one of its members. The 2nd petitioner is also a member of the 1st petitioner. He is a shareholder of a Member Company of the 1st petitioner.

2. The 1st respondent is the nodal Ministry in-charge of all matters and policies relating to Revenue. Respondent 2 is an apex body functioning under the control of respondent 1 that regulates all policy decisions relating to Central Excise, Customs and Service Tax matters. One of the functions of the 2nd respondent is to issue clarifications under Section 378 of the Central Excise Act, 1944 read with Section 83 of the Finance Act, 1994. Respondent 3 is the Commissioner of Service Tax and Respondent 4 is the Additional Commissioner (Technical) Service Tax, Mumbai. The 5th respondent is M/s. Oil & Natural Gas Co. Ltd. ("ONGC" for short). It is an instrumentality of State and has entered into various contracts with the members of the 1st petitioner.

3. Before we go to the facts of the case and the challenge raised in this petition, it is necessary to see the legal provisions and various circulars which have relevance to the present case.

4. In 1994 Chapter V of the Finance Act, 1994 was enacted in order to tax services rendered by service providers in India. Each year more and more services have been made taxable.

5. Section 65 (105) defines taxable service to mean any service provided or to be provided as enumerated in the sub-clauses therein. Section 66 of the Finance Act, 1994 is the charging section which says that services referred to in sub-clauses of clause 105 of Section 65 are taxable as per the rates stated therein. Section 68(1) places the duty of paying service tax on the service providers.

6. The Finance Act 1994 requires the service provider to register himself and to self-assess service tax payable by him. The manner of payment of service tax is laid down in the Service Tax Rules, 1994. The service tax provider is entitled to recover the service tax from the service consumer.

7. Entry (zzzy) was inserted into Section 65 (105) of the Finance Act, 1994 by the Finance Act, 2007.

The said entry reads as under:

"Any service provided or to be provided to any person by any other person in relation to mining of mineral, oil or gas"

8. By Circular No. 334/1/2007-TRU (Letter D.O.F. No.) dated 28/2/07 respondent 1 clarified that the different entries relating to mining activities were being consolidated under the said entry. We may quote the relevant portion of the said circular:

6.2. Mining Service (section 65(105)(zzzy)): Presently, geological, geophysical or other prospecting, surface or sub-surface surveying or map-making services relating to location or explanation of deposits of mineral, oil or gas are leviable to service tax under "survey and exploration of mineral service" (section 65(105)(zzv)).

Services such as

*.site formation and clearance, and excavation and earth moving, drilling wells for production/exploitation of hydrocarbons (development drilling)

*. well testing and analysis services

*. subcontracted services such as deploying workers and machinery for extraction/breaking of rocks into stones, sieving, grading, etc.

*. outsourced services, provided for mining are individually classified under the appropriate taxable service. Services provided in relation to mining of mineral, oil and gas are comprehensively covered under this proposed service. With this, services provided in relation to both exploration and exploitation of mineral, oil or gas will be comprehensively brought under the service tax net."

9. By a further Circular bearing No. 232/2/2006-CX dated 12/11/07 it was further clarified that post mining activities like transportation were not covered by the said Entry.

Paragraph 5 thereof reads as under:

"5. Handling and transportation of coal/mineral from pit head to a specified location within mine/factory or for mine 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 system, merry-go-round systems etc. and the same is chargeable under cargo handling service, even if the loading, unloading and similar activities are done using mechanical systems."

10. Entry (zzzzj) was inserted into Section 65(105) of the Finance Act, 1994 by the Finance Act 2008 with effect from 16/5/08. The said entry reads as under:

"Section (65(105)(zzzzj)

To any person, by any other person in relation to supply of tangible goods including machinery, equipment and appliances for use, without transferring right of possession and effective control of such machinery, equipment and appliance".

11. It is now necessary to state the petitioners case. Members of the 1st petitioner provide services to major exploration and production operators (in India as well as in the international waters) with their various vessels that include offshore drilling rigs, offshore support vessels, harbour tugs and construction barges. The vessels provided by the members of the 1st petitioner carry out various jobs, inter alia, as enumerated hereunder:

a). The Offshore Support Vessels carry out various types of jobs like, anchor handling, towing of vessel, supply to rig or platform, diving support, fire fighting and safety support in designated and non-designated areas.

b). The marine construction barge supports offshore construction, provides accommodation, crane support and stoppage area on main deck for equipment.

c). The harbour tugs are deployed for piloting big vessels in and out of the harbour and for husbanding main fleet.

12. Members of the 1st petitioner give the above-mentioned vessels on time charter basis to various oil and gas producers to carry out offshore exploration and production activities. For convenience services provided by the members of the 1st petitioner are hereinafter referred to collectively as "Marine Logistic Services". Various members of the 1st petitioner have entered into such contracts with ONGC the 5th respondent herein.

13. By letter dated 14/8/07 addressed by SCI who is one of the members of the 1st petitioner, the 5th respondent was informed that the new taxing entry has come into effect from 1/6/07 in relation to "mining of mineral, oil or gas" and that Service Tax on charter hire of various types of vessels will be charged from the 5th respondent as per the terms of tender for charter hire of various types of vessels. This letter indirectly referred to entry (zzzy).

14. In view of the doubts on the taxability of the offshore oil-field services rendered by its various members, the 1st petitioner addressed a letter to the 3rd respondent and sought clarification regarding applicability of Service Tax on the Marine Logistic Services rendered by Offshore Support Vessels under entry (zzzy) i.e. treating them as services "in relation to mining or mineral oil or gas". vide its letter dated 17/8/07. Correspondence ensued between SCI and the 5th respondent. Letters of the 5th respondent indicate its stand. According to the 5th respondent Marine Logistic Support has no direct nexus with the mining operations and hence Service Tax should not be deposited in reference to charter hire of vessels. The 5th respondent indicated its decision not to reimburse Service Tax unless it is found leviable by a higher legal forum. Similar letters were sent by the 5th respondent to other members of the 1st petitioner.

15. The 1st petitioner received a clarification letter from the 3rd respondent on 17/12/07 wherein it was mentioned that the Marine Logistic Services rendered by the members of the 1st petitioner are in relation to "Mining of Mineral Oil or Gas Service as defined under subclause (zzzy) of Section 65(105) of the Finance Act, 1994." A further letter dated 19/2/08 was addressed to the 1st petitioner by the 4th respondent as a reply to its representation dated 28/11/07 reiterating the view of the 3rd respondent that Marine Logistic Service is liable to Service Tax. Members of the 1st petitioner were advised that they should obtain registration with Service Tax authorities and pay Service Tax. It was further stated in the letter that the 2nd respondent had directed that action may be taken in accordance with law. It is not necessary to refer to various letters sent by the 5th respondent to the 1st petitioner, to SCI and to other members because the 5th respondent maintained its stand that Marine Logistic Services are not covered by entry (zzzy).

16. By the impugned letter dated 5/3/08 the 4th respondent required the members of the 1st petitioner to discharge the liability of Service Tax irrespective of the fact that Service Tax was not paid. Thereafter the Department initiated action against various members of the 1st petitioner and issued summonses to gather information.

17. Being aggrieved by this action of the respondents, the petitioners filed the instant writ petition on 6/11/08 praying inter alia for a declaration that the taxing entry contained in Section 65(105)(zzzy) of the Finance Act 1994 does not apply to Marine Logistic Services provided by the members of the 1st petitioner. The petitioners seek an order directing the respondents not to demand Service Tax from the members of the 1st petitioner on Marine Logistic Services. Alternatively an order is sought directing the 5th respondent to pay Service Tax on the Marine Logistic Services rendered to it by the members of the 1st petitioner.

18. In the meantime by the Finance Act 2008 Entry (zzzzj) which we have quoted hereinabove was inserted into subsection (105) of Section 65 of the Finance Act, 1994 to be effective from 16/5/08 to tax service in relation to supply of tangible goods including machinery, equipment and appliances for use, without transferring right of possession and effective control of such machinery, equipment and appliance. The 2nd respondent by Circular bearing No. M.F. (DR) Letter D.O.T. No. 334/1/2008 TRU dated 29/2/08 clarified the scope of this entry as covering inter alia, the supply of vessels without giving legal right of possession and effective control, such as offered by the members of the 1st petitioner. We may quote the relevant paragraph of the said circular:

"4.4.2. Excavators, wheel loaders, dump trucks, crawler carriers, compaction equipment, cranes etc., offshore construction vessels and barge flotillas, rigs & high value machineries are supplied for use, with no legal right of possession and effective control. Transaction of allowing another person to use the goods, without giving legal right of possession and effective control, not being treated as sale of goods, is treated as service".

19. The members of the 1st petitioner are paying Service Tax under Entry 65(105)(zzzzj) with effect from 16/5/08. The petitioners amended the instant petition inserting the necessary averments in relation to new entry (zzzzj). The controversy in the present petition is only for the period from 1/6/07 to 15/5/08.

20. We have heard learned counsel for the parties. We have also perused the written submissions submitted by them.

21. Mr. Nankani, learned counsel for the petitioners submitted that the members of the 1st petitioner are engaged in operation of offshore vessels. Chartering of vessel is not an activity relating to mining. He submitted that entry (zzzy) covers only premining activities. He took us to the circular dated 28/2/07 and circular dated 12/11/07 in support of this submission. Relying on the judgment of the Supreme Court in Navin Chemicals Mfg. & Trading Co. Ltd. v. Collector of Customs, (1993) 4 SCC 320 [LQ/SC/1993/754] ) and the judgment of this court in C.K.P. Mandal v. Commissioner of Central Excise, Mumbai, (2006(4) STR 183 (Bom.). Mr. Nankani submitted that the phrase "in relation to" means that the activity must have a direct relation to the subject matter of the taxing entry. He submitted that the activities of the members of the petitioner are premining in nature. They have no direct relation to the mining activity, hence they are not covered by entry (zzzy).

22. Mr. Nankani submitted that the activities undertaken by the members of the 1st petitioner have been specifically brought to the levy of Service Tax only upon insertion of the new entry i.e. Section 65(105)(zzzzj) with effect from 16/5/08. The 1st petitioners members are paying Service Tax as per the said entry on the Marine Logistic Services provided by them.

23. Mr. Nankani submitted that when a new entry is introduced, it can be looked into for interpreting the scope of an earlier entry in a taxing statute. In this connection he relied on Pappu Sweets & Biscuits & Anr. v. Commissioner of Trade Tax, U.P. Lucknow (1998) 7 SCC 228 [LQ/SC/1998/1006] and Yogendra Nath Naskar v. CIT, Calcutta, (1969) 1 SCC 555 [LQ/SC/1969/77] ). Mr. Nankani submitted that entry (zzzzj) is an independent entry and is not carved out from entry (zzzy). He pointed out that upon the insertion of entry (zzzzj), there was no amendment to the old entry (zzzj). Therefore, subject matter of entry (zzzzj) is not covered by earlier entry (zzzy). If it was covered there was no need to have an independent entry (zzzzj). The demand for Service Tax on Marine Logistics Service prior to the introduction of the entry (zzzzj) is, therefore, bad in law.

24. Mr. Nankani submitted that it is well settled that the legislation of a new entry to cover any activity necessarily implies that the activity was not liable to tax prior to the insertion, unless the new entry is clearly set out as a carve-out from a pre-existing entry. In this connection he relied on the judgments of the Customs Excise and Service Tax Appellate Tribunal ("CEGAT" for short) in Glaxo Smithkline Pharmaceuticals Ltd. 2005(188) ELT (Tri), Board of Control for Cricket in India, 2007 (7) STR 384 (Tri), Gujarat Chemical Port Terminal Co. Ltd., 2008 (9) STR 386 (Tri) and Diebold Systems (P) Ltd. 2008- 9b STR 546 (Tri).

25. Mr. Nankani submitted that Section 65-A is called in to determine classification of services only where there are two or more entries which may equally appear to cover an activity, one of which is the genus and the other is a specie. Inasmuch as entry (zzzzj) is not a specie of what is covered by entry (zzzy), the invocation of Section 65-A to decide the classification is unsustainable.

26. Mr. Nankani submitted that in any event, even if Section 65A were to be applied, the services provided by the members of the 1st petitioner are specifically covered by the taxing entry for supply of tangible goods, and applying the principles set out in Section 65A (2) (a) also, the services are rightly covered under entry 65(105)(zzzzj).

27. Lastly Mr. Nankani submitted that the service provider who pays the Service Tax is entitled to recover the same from the service consumer, Service Tax being an indirect tax. In this case even contractually the 5th respondent is liable to reimburse the tax to the members of the 1st petitioner under the respective contracts entered into by such members with the 5th respondent. Mr. Nankani submitted that in the event of this court coming to the conclusion that Service Tax is payable on Marine Logistic Services this court may direct the 5th respondent to pay Service Tax to the members of the 1st petitioner on the Marine Logistic Services rendered by them to the 5th respondent.

28. Mr. Sankhlecha, learned counsel for the 5th respondent adopted all arguments of Mr. Nankani except his arguments in relation to alternative prayer (b). He added that India having adopted selective approach, the service to be charged to Service Tax is to be covered by an entry specifically and any service remotely connected to another service cannot be covered under the head by which that another service is covered. In this connection he relied on the Assam High Courts judgment in Magus Construction Pvt. Ltd. v. Union of India (2008 TOL 321).

29. Mr. Sankhlecha submitted that assuming Marine Logistic Services have any remote connection to mining, they cannot be included in the entry (zzzy). Learned counsel submitted that the services rendered by the members of the 1st petitioner are only of transport of goods and men by sea. He drew our attention to Section 65-105-(zzn) of the Finance Act, 1994 which relates to transport by aircraft. He also referred to Section 65-105-(zzp) which relates to transport by road. He also referred to Section 65-105(zzz) which covers transport of goods other than water, through pipelines or conduit. There was no specific entry covering transport by sea and, therefore, that activity, according to learned counsel, cannot be made subject to tax unless so specifically mentioned in the Finance Act, 1994. He submitted that the judgment of the Supreme Court in Tamil Nadu Kalyan Mandapam Association v. Union of India, 2004 (167) ELT 3(SC) has no application to the present case because catering services were held to be includable in the Mandap Keeper Services in view of the specific definition of taxable service with regard to a Mandap Keeper which includes services rendered as a caterer.

30. Relying on the judgment of the Supreme Court in All India Federation of Tax Practitioner, 2007 (7) STR 625(SC), learned counsel submitted that though the words "in relation to" are of wide amplitude one has to keep in mind the context in which they are used. He also relied on the Supreme Court judgment in Navin Chemicals case (supra) in this connection.

31. Learned counsel submitted that the introduction of entry (zzzzj) with effect from 16/5/08 emphasises that no tax was payable on Marine Logistic Services prior to 16/5/08 because the new entry was not by way of amending the earlier entry.

32. As regards alternative prayer of the petitioners is concerned, Mr. Sankhlecha submitted that in case this court is not inclined to accept the above submissions then the quantification and examination of each activity of service rendered should be done by the adjudicating authorities. He submitted that the 5th respondent has undertaken and is obliged to reimburse the petitioners in respect of services being rendered by the members of the 1st petitioner which are taxable and not any figure demanded by respondents 1 to 4 which the members of the 1st petitioner may agree to pay without considering the nature of service which is subject to tax.

33. Mr. Rao, learned counsel for respondents 1 to 4 took us through the affidavit in reply of Shri Pitambar Bagh Assistant Commissioner (DN 1, Service Tax Commissionerate, Mumbai). It is inter alia stated by Shri Bagh that all services in relation to mining of minerals, oil or gas are covered under mining services. It is further stated in the affidavit that the members of the 1st petitioner provide machinery equipment, labour and other infrastructure to the 5th respondent. The said services are, therefore, relating to the mining of minerals, oil or gas and are as such covered by Section 65 (105) (zzzy). Mr. Rao has reiterated these submissions. Mr. Rao added that the petition is premature because the petitioners have approached this court before issuance of show cause notice. He submitted that detailed examination of facts is not permissible in writ jurisdiction. He submitted that, therefore, the present petition is liable to be dismissed.

34. We are concerned here with the scope of entry (zzzy) inserted into Section 65(105) of the Finance Act 1994 by the Finance Act, 2007. The moot question is what kind of services are covered by this entry. As noticed by us hereinabove entry (zzzzj) was inserted into Section 65(105) of the Finance Act, 1994 by the Finance Act 2008 with effect from 16/5/08. Services rendered by the 1st petitioners members have been specifically brought to levy of Service Tax only upon insertion of the new entry and they have been paying Service Tax accordingly. Thus they have accepted that services rendered by them are covered by this new entry but their contention is that those services i.e. Marine Logistic Services are not covered by entry(zzzy).

35. In our opinion, entry (zzzzj) would provide an important aid for the interpretation of entry (zzzy) and such a course is permissible in law. In Yogendra Nath Naskars case (supra) the Supreme Court was inter alia considering whether a Hindu Idol is a juristic entity capable of holding property and of being taxed through its Shebaits. Section 2(9) and Section 3 of the Indian Income Tax Act, 1922 fell for its consideration. While considering amplitude of the definition of the term person given in Section 2(9) of the Income Tax Act, 1922, the Supreme Court referred to Section 2(31) of the Income Tax Act, 1961 which defines "person", compared the two and held that the word "individual" in Section 3 of the Income Tax Act, 1922 includes within its connotation all artificial jurisdical persons. Language employed in Section 2(31) of the Income Tax Act, 1961 was relied upon as a Parliamentary exposition of the earlier Act. Relying on Cape Brandy Syndicate v. I.R.C. (1921) 2 KB 403) the Supreme Court concluded that, if there is any ambiguity in the earlier legislation, then the subsequent legislation may fix the proper interpretation which is to be put upon the earlier Act.

36. The same view was reiterated by the Supreme Court in Pappu Sweets case (supra) and in Gem Granites v. Commissioner of Income-Tax T.N. (2005) 1 SCC 289 [LQ/SC/2004/1330] ). Therefore, it is open for us to consider the scope of entry (zzzzj) while interpreting entry (zzzy).

37. Entry (zzzzj) is entirely a new entry. Whereas entry (zzzy) covers services provided to any person in relation to mining of mineral, oil or gas, services covered by entry (zzzzj) can be identified by the presence of two characteristics namely (a) supply of tangible goods including machinery, equipment and appliances for use, (b) there is no transfer of right of possession and effective control of such machinery, equipment and appliances. According to the members of the 1st petitioner, they supply offshore support vessels to carry out jobs like anchor handling, towing of vessels, supply to rig or platform, diving support, fire fighting etc. Their marine construction barges support offshore construction, provide accommodation, crane support and stoppage area on main deck or equipment. Their harbour tugs are deployed for piloting big vessels in and out of the harbour and for husbanding main fleet. They give vessels on time charter basis to oil and gas producers to carry out offshore exploration and production activities. The right of possession and effective control of such machinery, equipment and appliances is not parted with. Therefore, those activities clearly fall in entry (zzzzj) and the services rendered by the members of the 1st petitioner have been specifically brought to the levy of Service Tax only upon the insertion of this new entry.

38. If the Departments contention is accepted that would mean that the activities of the members of the 1st petitioner are covered by entry (zzzy) and entry (zzzzj). Such a result is difficult to comprehend because entry (zzzzj) is not a specie of what is covered by entry (zzzy). Introduction of new entry and inclusion of certain services in that entry would presuppose that there was no earlier entry covering the said services. Therefore, prior to introduction of entry (zzzzj), the services rendered by the members of the 1st petitioner were not taxable. Creation of new entry is not by way of amending the earlier entry. It is not a carve out of the earlier entry. Therefore, the services rendered by the members of the 1st petitioner cannot be brought to tax under that entry.

39. At this stage, we may usefully refer to the judgment of the Assam High Court in Magus Corporations case (supra). While discussing what is tax on services the Assam High Court observed as under:

"It may be pointed out, at the very outset, that tax on services is an "indirect tax" and is a relatively new concept in India. As a matter of fact, Government of India and introduced the levy of "service tax", i.e. tax on the services, for the first time, in the year 1994, borrowing the concept from developed countries. The basic purpose of this levy has been to increase revenue, treating the act(s) of rendering service, as an additional source of revenue. Depending upon its own socio-economic compulsions, each country evolves its system of taxation adapting either a "comprehensive approach" or "selective approach". Under the concept of "comprehensive approach", all services are taxable unless any of the services is specifically excluded; whereas under the system of "selective approach", only specified services are taxable and it is the system of "selective approach", which India has adopted. This distinction needs to be kept in mind, when we proceed further."

40. It is pertinent to note that Section 65(105)(zzn) of the Finance Act, 1994 covered services rendered to "any person, by an aircraft operator, in relation to transport of goods by aircraft". Section 65(105)(zzp) covered services rendered to "any person by a goods transport agency in relation to transport of goods by road in a goods carriage". Section 65(105(zzz) refers to service rendered to any person in relation to transport of goods other than water, through pipeline or other conduit. There was no entry covering transport by sea. Legislature could have easily provided for such an entry. Absence of such entry leads us to conclude that the chartering of vessels undertaken by the members of the 1st petitioner was not covered by any entry prior to insertion of entry (zzzzj). In the light of judgment of the Assam High Court in Magus Corporations case (supra) it must be held that the said services were not specified under any entry and hence were not liable to service tax till entry (zzzzj) was introduced covering them.

41. This conclusion of ours is supported by the circulars to which, we have made reference hereinabove. We have also quoted the relevant extracts of the said circular. At the cost of repetition, we must state that when entry (zzzy) was inserted into Section 65(105) of the Finance Act, 1994, by Circular No. 334/1/2007.TRU dated 28/2/07 it was clarified that the different entries relating to mining activities were being consolidated under the said entry. Mining activities were defined in the said circular to cover any activity in relation to the earth at premining stage or the actual operation of mining of minerals. It was clarified that services in relation to both exploration and exploitation of mineral, oil or gas were comprehensively brought under the service tax net. By a further circular dated 12/11/07 it was clarified that handling and transportation of coal/mineral from pit head to a specified location within mine/factory or transportation outside the mine being post-mining activities are chargeable to service tax under the relevant taxable services i.e. Cargo Handling Service and Goods Transport by Road.

42. Thus activities which had direct relation to mining were covered by entry (zzzy) Transport of goods by air and road was covered by separate entries. There was no separate entry for transport by sea. The fact that charter hire of vessels is brought to tax under entry (zzzzj) indicates that the said entry is to cover transport by sea.

43. It is contended on behalf of the Department that the words "in relation to" employed in entry (zzzzy) are of wide import and cover activities of the members of the 1st petitioner. Shri Pawan Kumar Asst. Commissioner Service Tax has in his affidavit stated that though the services provided by the petitioners members may not be mining operations, they are services in relation to mining operation and therefore, the said entry has a sweeping effect and it covers ancillary services. Reliance is placed on the Supreme Courts judgment in Tamil Nadu Kalyan Mandapams case (supra). In that case the Supreme Court was dealing with the grievance made by the Mandap-keepers inter alia that the provisions of Chapter V of the Finance Act 1994 in so far as they relate to Mandap-keepers were illegal and ultravires the Constitution. One of the questions raised before the Supreme Court was whether taxable service could include mere providing of premises on temporary basis for organizing any official, social or business functions, but would also include other facilities supplied in relation thereto. In that context the Supreme Court referred to the definition of Mandap-keeper. The Supreme Court observed that the said definition includes services provided in "relation to use of Mandap in any manner" and includes "the facilities provided to the client in relation to such use" and also "the services rendered as a caterer". This definition specifically included the facilities provided to the client in the ambit of services provided in relation to use of Mandaps. It is evident that it is this definition which persuaded the Supreme Court to hold that wide range of services are included in the definition of taxable services so far as Mandap-keepers are concerned. It is on the basis of this definition that the Supreme Court concluded that taxable service could include the mere providing of premises on a temporary basis for organizing any official, social or business function, but would also include other facilities supplied in relation thereto. The observations of the Supreme Court must be understood against this background.

44. A Division Bench of this court to which one of us (Devadhar, J.) was a party in C.K.P. Mandals case (supra) distinguished the Supreme Courts judgment in Tamil Nadu Kalyan Mandapams case (supra) and observed that where the Mandap keeper provides services including catering to the hirer of the mandap such services are leviable to tax, but where the Mandap keeper asks the hirer to take catering services from a particular caterer it cannot be said that the Mandap keeper has provided catering service indirectly to the hirer. Thus this court made it clear that the activity must have a direct or proximate relation to the subject matter of the entry.

45. Scope of the phrase "in relation to" is indeed wide. But its parameters have to be understood in its context. In Navin Chemicals case (supra) the controversy before the Supreme Court related to the expression "determination of any question having a relation to the rate of duty of customs or to the value of gods for purposes of assessment" found in Section 129 (3) of the Customs Act, 1962. This provision requires that appeal against the decision relating to the above questions must be heard by a Special Bench. The Supreme Court considered this provision against the backdrop of other provisions and more particularly Section 129-D and observed that though the phrase "relation to" is ordinarily, of wide import, in the context of its use in the said expression in Section 129-C, it must be read as meaning a direct and proximate relationship to the rate of duty and to the value of goods for the purposes of assessment.

46. We may also usefully refer to the judgment of the Supreme Court in All India Federation of Tax Practitioners case (supra). The appeal before the Supreme Court questioned the competence of Parliament to levy service tax on practicing chartered accountants and architects having regard to Entry 60 List II of the Seventh Schedule to the Constitution and Article 276 of the Constitution. Article 276(1) of the Constitution inter alia states that notwithstanding anything in article 246, no law of Legislature of a State relating to taxes for the benefit of the State in respect of professions, trades, callings or employments shall be invalid on the ground that it relates to a tax on income. Entry 92C of List 1 of the Seventh Schedule to the Constitution pertains to "Taxes on Services". Entry 60 of List II of the Seventh Schedule to the Constitution pertains to "Taxes on profession, trades, callings and employment". It was submitted before the Supreme Court that the State Legislature alone has the legislative competence to levy service tax. It was argued that the word "profession" in Entry 60 of List II was nothing but service and, therefore, levy of service tax came within the competence of State Legislature alone. Placing reliance on Article 276(1) it was urged that the words used in Article 276(1) namely, "no law of the State Legislature relating to taxes in respect of professions, callings etc." were words of widest amplitude and, therefore, the word "profession" would cover every aspect connected with it. It was urged that since the expressions "relating to" and "in respect of" are known in law as words of widest amplitude, if the significance of the said expressions is kept in mind, then it becomes clear that the Constitution framers intended the State Legislature alone to be competent to impose taxes on professions, trades calling and employments. While dealing with this submission the Supreme Court drew distinction between a taxing entry and a general entry and held that Entry 60 is a taxing entry and, therefore, tax on professions has to be read as a levy on professions trades etc. It cannot be extended to include services. The Supreme Court laid stress on the schematic interpretation of the three lists in the Seventh Schedule while interpreting the legislative heads under list II. Repelling the contention of the appellants the Supreme Court observed that the words in "relation to" and the words "with respect to" are no doubt words of wide amplitude but one has to keep in mind the context in which they are used. The Supreme Court in the circumstances concluded that parliament had legislative competence to levy tax on services.

47. From the above judgments the inevitable conclusion that follows is that the services rendered by a person must have a direct or a proximate relation to the subject matter of the taxing entry and the context in which the words in relation to are used has to be borne in mind to judge the extent of the scope of an entry which maybe of wide amplitude. In the circumstances of the case services having remote connections cannot be included in entry (zzzy) merely on the strength of the words "in relation to".

48. Applying the above conclusions to the instant case, we hold that the services rendered by the members of the 1st petitioner are either premining or post mining activities. They have no direct relation to mining. They were, therefore, rightly not brought to tax till entry (zzzzj) was introduced to cover transport of tangible goods by sea without transferring right of possession and effective control thereof. The services rendered by the members of the 1st petitioner are covered by entry (zzzzj) because they inter alia supply vessels offshore support vessels, barges, tugs etc. without transferring right of possession and effective control over them. In contrast entry (zzzy) was introduced to comprehensively bring under the service tax net activities having a direct nexus to mining activities. Entry (zzzzj) is not a carve out of entry (zzzy). Both entries are independent. Entry (zzzzj) was not inserted into the Finance Act by amending entry (zzzy). It is not possible to invent a remote connection of the services rendered by the members of the 1st petitioner to mining activities and hold that they fall in entry (zzzy). Entry (zzzzj) is not a specie of what is covered by entry (zzzy). Nature of the services rendered by the members of the 1st petitioner, legislative history of the two entries, various circulars to which, we have made reference and the relevant judgments which we have noted hereinabove lead us to hold that the entry contained in Section 65(105)(zzzy) of the Finance Act, 1994 does not apply to services provided by the members of the 1st petitioner. Needless to say that respondents 1 to 4 and respondent 6 cannot demand service tax from the members of the 1st petitioner on the services rendered by them to the 5th respondent. As a consequence of this view of ours proceedings leading to issuance of letters dated 17/12/07, 19/2/08 and 5/3/08 annexed as Exhibits H,N & R respectively to the petition stand quashed and set aside.

49. The petition is disposed of in the aforestated terms.