Goods transport agency tax applies only with consignment note and cargo responsibility; mere lorry hiring is outside the levy.

Tax on goods transport agency service applies only where the service provider qualifies as a goods transport agency by accepting responsibility for the cargo and issuing a consignment note. Mere hiring of individual lorry operators for transport of iron ore does not, by itself, bring the activity within the statutory levy. Invoices showing service tax components, or trip-sheet references to consignment numbers, are insufficient to prove issuance of a consignment note. On these facts, the transport activity fell outside the scope of section 65(105)(zzp), and the demand for tax could not be sustained.

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Issues: Whether the consideration paid for hiring lorries for transport of iron ore from the mines to the port was taxable as services of a goods transport agency, and whether the presence of invoice entries or trip-sheet references to consignment numbers established liability.

Analysis: Tax under section 65(105)(zzp) of the Finance Act, 1994 applies only when the service provider is a goods transport agency within section 65(50b) of the Finance Act, 1994, which requires acceptance of responsibility for the cargo and issuance of a consignment note. The mere transportation of goods by an individual truck operator does not, by itself, amount to a taxable agency service. The invoices relied upon showed only inclusion and deduction of service tax components, and a reference to a consignment number in a trip sheet did not establish issuance of a consignment note. On the facts, the transport activity was carried out by lorry operators outside the statutory ambit of the levy.

Conclusion: The transportation charges were not taxable as goods transport agency service and the demand could not be sustained.

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