Reverse charge on goods transport services failed where transport came from individual truck owners without consignment notes.

Service tax under reverse charge on alleged goods transport agency services was challenged because the demand rested on balance-sheet entries for freight and forwarding expenses and carriage outward. The appellant stated that transport was obtained from individual truck owners and that no consignment note was issued. As the records did not show that the service providers were goods transport agents or that consignment notes had been issued, the demand was found not maintainable.

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Issues: Whether service tax was payable under reverse charge mechanism on the alleged receipt of goods transport agency service.

Analysis: The demand was founded on balance-sheet entries showing freight and forwarding expenses and carriage outward. The appellant disputed receipt of goods transport agency service and asserted that transport was received from individual truck owners who had not issued any consignment note. The records did not show any contrary finding that the service providers were goods transport agents or that they had issued consignment notes.

Conclusion: The demand was held to be not maintainable and the appeal was allowed.

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