Service tax exemption for trucks on hire to a goods transport agency, with extended limitation rejected for lack of suppression.

Services by an individual truck owner in giving goods vehicles on hire to a goods transport agency fell within Entry 22(b) of Mega Exemption Notification No. 25/2012-Service Tax, because the activity was a hire of a means of transport of goods to a GTA and the provider was not shown to be a goods transport agency itself. On that basis, the service tax demand could not survive on merits. The extended period of limitation was also held unavailable, as the record disclosed no positive act, suppression, or mala fide intent to evade tax. The demand was therefore unsustainable on both merits and limitation.

---

---

Issues: (i) Whether amounts received by an individual truck owner for giving vehicles on hire to goods transport agencies were exempt from service tax under the mega exemption notification. (ii) Whether the extended period of limitation could be invoked for the demand.

Issue (i): Whether amounts received by an individual truck owner for giving vehicles on hire to goods transport agencies were exempt from service tax under the mega exemption notification.

Analysis: The receipts were found to be truck rent paid by registered goods transport agencies, and the vehicles were admittedly given on hire for transportation of goods by road. Entry No. 22(b) of Mega Exemption Notification No. 25/2012-Service Tax exempts services by way of giving on hire of a means of transport of goods to a goods transport agency. The appellant was only an individual owner of trucks and was not shown to be a goods transport agency itself. On these facts, the demand could not survive on merits.

Conclusion: The amounts received for hiring trucks to goods transport agencies were exempt and no service tax was payable by the appellant.

Issue (ii): Whether the extended period of limitation could be invoked for the demand.

Analysis: The show cause notice covered a period much earlier than its issuance, and the record did not disclose any positive act, suppression, or mala fide intent to evade tax. In the absence of such material, invocation of the extended period was not justified.

Conclusion: The extended period of limitation was wrongly invoked.

Final Conclusion: The demand was unsustainable on both merits and limitation, and the appeal succeeded.

Ratio Decidendi: Services of giving vehicles on hire to a goods transport agency fall within the notified exemption, and the extended limitation period cannot be invoked without material showing suppression or intent to evade tax.

---