2019 (1) TMI 1230 - AT - Service Tax

Appellant's Service Tax Refund Claim Denied in GTA Case

The appellant's claim for a refund of service tax paid under GTA service to M/s. Shiva Cargo Movers Ltd. was rejected as no excess payment was found. The ... Refund the service tax paid under GTA service - after paying the service tax, later, they were of the opinion that no service tax has to be paid on the freight incurred by M/s. Shiva Cargo Movers Ltd. as the transporter does not qualify as Goods Transport Agency - refund claim was rejected holding that the tax paid is in order and that there is no ground for granting refund - Held that:- The transporter who is entrusted with the duty of transporting the goods of another and who has to issue consignment note or such other documents evidencing the transportation of the goods will fall under the category of GTA as provided under section 65(50b) of the Finance Act, 1994 - In the instant case, M/s. Shiva Cargo Movers Ltd. provides services of transporting of the goods by the appellant in their vehicles by road and also issues documents for evidencing such transport. M/s. Shiva Cargo Movers Ltd. are not owners of the goods. In Commissioner of Central Excise, Guntur Vs. Chebrolu Agro Pvt. Ltd. [2017 (6) TMI 1248 - CESTAT HYDERABAD], it was observed that when tobacco is transported by private truck operators, and even though no consignment note is issued, the assessee being recipient of services is liable to pay service tax. The service tax discharged by the appellant is in order - appellants are therefore not entitled to refund - appeal dismissed - decided against appellant. Issues:1. Whether the appellant is eligible for a refund of service tax paid under GTA service for the period June 2009 to May 2010.2. Whether M/s. Shiva Cargo Movers Ltd. qualifies as a Goods Transport Agency (GTA) for the purpose of service tax liability.3. Interpretation of Notification No.36/2004-ST dated 31.12.2004 regarding the responsibility of discharging service tax by the service recipient in the context of individual truck owners.Analysis:1. The appellant, engaged in the manufacture of denatured spirit and rectified spirit, filed a refund claim for service tax paid under GTA service to M/s. Shiva Cargo Movers Ltd. The claim was rejected initially, leading to an appeal. The Tribunal remanded the matter for verification, which concluded that there was no excess or double payment of service tax, resulting in the rejection of the refund claim. The Commissioner (Appeals) upheld the rejection, leading to the current appeal.2. The appellant argued that M/s. Shiva Cargo Movers Ltd., a group company, is not a GTA and thus, the appellant should not be liable to pay service tax. The appellant cited the Budget Speech of 2004 to support the claim that individual truck owners were not intended to be taxed. However, the Tribunal held that M/s. Shiva Cargo Movers Ltd. falls under the category of GTA as they transport goods by road and issue relevant documents. The responsibility of discharging service tax under GTA service is on the service recipient, as per Notification No.36/2004-ST. The Tribunal referenced a case law to support the decision that even when private truck operators transport goods without issuing consignment notes, the service recipient is liable to pay service tax.3. The Tribunal found that the service tax paid by the appellant was in order, as M/s. Shiva Cargo Movers Ltd. provided transportation services and issued relevant documents. Therefore, the appellant was not entitled to a refund, and the impugned order was upheld. The appeal was dismissed, emphasizing that the service tax liability was correctly discharged by the appellant under the GTA service category.(Judges: Ms. Sulekha Beevi C.S., Member (Judicial) and Shri Madhu Mohan Damodhar, Member (Technical))