Service tax on GTA

[Murari Agrawal]

Dear Experts,

(1) We are removing goods upon payment of duty as well as on Job work. We are engaging local transporters from stands who do not issue any consignment note. Some of them issue bill on monthly basis giving details of each consignment and payment is made by cheque. Payment to some is made by cash against voucher. The amount of freight for individual consignments is between Rs. 700 to Rs. 1500.

(2) For Job work we are collecting the inputs from principal manufacturer and pay freight in the similar manner. We raise our bill for transportation charges. Some times, we pay less to the transporters than we collect.

(3) We are getting inputs from outside State. Transporter issues consignment note and the payment is made by us.

Kindly let us know our service tax liability in the above cases.

AI Summary

No Service Tax on Local Transporters Without Consignment Notes; Commission Income May Be Taxable Under Certain Conditions. An individual inquired about their service tax liability concerning goods transportation. They use local transporters who don't issue consignment notes, pay them by cheque or cash, and sometimes pay less than what they charge for transportation. An expert clarified that since these transporters are self-employed and not acting as a Goods Transport Agency (GTA), no service tax is due. However, if the individual earns a commission from transportation charges, it may be taxable. For consignments involving consignment notes, service tax is applicable on the abated value, with the possibility of claiming cenvat credit.