Business Support Service

[Sanjeev Chauhan]

Respected All,

If a manufacturer of excisable goods is arranging transportation for their customers and collecting such freight charges on his Invoice (such freight charges are not includible in Assassable value of excisable goods) , than such arrangement of transportation for customers would be liable to service Tax under Business sport service.

Regards,

Sanjeev.

[YAGAY andSUN]

Service Tax would be payable under GTA Service.

[Brijesh Verma]

With regards to Pradeep ji's reply, I differ in opinion on this issue. GTA Service is attracted only when the person issues a consignment note. 

Here, according to whatever has been stated, no consignment note will be issued by the manufacturer and consequently the service will not be GTA.

[MANDAVILLI RAMAKRISHNA]

your client is liable to tax under GTA service.

however, if the buyer gives you a letter stating that the ST on the transportation will be taken care by them, you can be waived 

[Rajesh Sharma]

Someone might be issuing consignment note, if the transportation vehicle is of manufacturer, then they should include the freight charges in the assessable value, as this is additional consideration they are receiving from the customer. Is that some kind of modus operandi. would like to know in detail about that.

AI Summary

Service tax on transportation: liability depends on consignment note presence and inclusion of freight in assessable value. The key issue is whether arranging transportation and collecting freight by a manufacturer is taxable: one position treats it as GTA Service attracting service tax; another limits GTA to cases with a consignment note, excluding transactions without such a note. If the manufacturer provides transport, freight may be includible in the assessable value as additional consideration. A buyer's written undertaking to bear the service tax may relieve the manufacturer from collecting it.