3 Service should be provided by airports authority or by any authorised person

3.1
AAI was formed on 1st April 1995 by merging the International Airports Authority of India and the National Airports Authority with a view to accelerate the integrated development, expansion and modernization of the operational, terminal and cargo facilities at the airports in the country conforming to international standards. Most of the International Airport and Domestic Airports as well as Civil Enclaves are managed by AAI. However, Hindustan Aeronautics Ltd. (‘HAL’), Delhi International Airports Pvt. Ltd. (‘DIAL’), Mumbai International Airports Pvt. Ltd. (‘MIAL’) and Cochin International Airport Ltd. (‘CIAL’) manage Bangalore, Delhi, Mumbai and Cochin airports respectively. Therefore, AAI, HAL, DIAL, MIAL and CIAL are airport authorities (‘the AA’) for the purpose of service tax.

3.2
As per section 12 of the AAI Act, AAI is required to manage the airports and the civil enclaves. It is also required to provide air traffic service and air transport service at any airport and civil enclaves. It is also mandated to establish warehouses and cargo complexes at the airports for the storage or processing of goods, arrange for postal, money exchange, insurance and telephone facilities for the use of passengers and other persons at the airports and civil enclaves.

3.3
Airport service can be provided directly by the AA or by a person authorised by the AA. Authorised person can be an individual or a group of individual whether incorporated or not. An authorised person can provide only those services for which he has been granted permission. An airport service provided by an un-authorised person can not be taxed under the category of airport service. Similarly, a service provided by an authorised person, for which he has not been authorised by the AA also can not be taxed under the category of airport service.