Inland waterway exemption applies only to statutory inland routes; sea transport between port and lighterage area remains taxable.

Transportation of goods between Magdalla Port and its General Lighterage Area did not qualify as transport by "inland waterways" because the route was part of the Arabian Sea and not a statutory inland waterway, national waterway, or other inland water under the relevant laws. As that core condition was not satisfied, Entry No. 18 of Notification No. 12/2017-Central Tax (Rate) did not apply, and the related exemption claim under the integrated tax notification also failed. The service was therefore taxable under GST and not eligible for the claimed exemption.

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Issues: (i) Whether transportation of goods between Magdalla Port, Surat and its General Lighterage Area falls within the expression "inland waterways" for the purpose of the exemption; (ii) Whether the said service is exempt under Entry No. 18 of Notification No. 12/2017-Central Tax (Rate).

Issue (i): Whether transportation of goods between Magdalla Port, Surat and its General Lighterage Area falls within the expression "inland waterways" for the purpose of the exemption.

Analysis: The relevant exemption covers transportation of goods by inland waterways. The expression "inland waterways" includes national waterways and other waterways on any inland water. The route in question was examined with reference to the statutory definition of national waterways under the Inland Waterways Authority of India Act, 1985 and the declaration of National Waterway 100 under the National Waterways Act, 2016. It was also examined whether the route could be treated as an "other waterway on any inland water" under the Inland Vessels Act, 1917. On the facts, the water stretch used for the service was part of the Arabian Sea and did not fall within the statutory category of canal, river, lake, or other navigable water within a State.

Conclusion: The transportation route does not fall within the definition of "inland waterways".

Issue (ii): Whether the said service is exempt under Entry No. 18 of Notification No. 12/2017-Central Tax (Rate).

Analysis: Since the service did not qualify as transportation by inland waterways, the exemption entry was not attracted. The alternative reliance on the integrated tax exemption notification also failed for the same reason, because the statutory requirement of transportation by inland waterways was not satisfied.

Conclusion: The service is not exempt under Entry No. 18 of Notification No. 12/2017-Central Tax (Rate).

Final Conclusion: The transportation service between Magdalla Port and its General Lighterage Area is taxable and does not enjoy the claimed GST exemption.

Ratio Decidendi: A transportation service qualifies for exemption as inland-waterway transport only when the route falls squarely within the statutory definition of national waterways or other inland waters; a sea route outside those definitions is not exempt.

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