negative list based regime

[Dalia Felix]

Dear Sirs,

Bangalore CESTAT in the case of KBN Enterprises (2013 (10) TMI 341 - CESTAT BANGALORE) has held that transportation of iron ore in goods carriage within the mine is not taxable under mining services. What do you think on the relevance/applicability of this case in the negative list based regime of service tax? my doubt is whether the service is taxable or not as per the present service tax provisions? Please justify your answer.

Thanks and regards,

[Rajesh Nathoo]

Dear Dalia ,

It is taxable under Negative List Regime as it is nowhere mentioned in Negative List .

[Viswanathan Nemmara]

Of late the Service Tax authorities have been raising demand stating that the goods transport done within the mines and upto loading point / sidings are part of "mining service" and are not covered under GTA service.  As a result the 75 percent exemption being availed by such mining industries is being denied to them.

This is a good decision for such mining industries since their stand of classifying the service under "GTA gets vindicated - provided, of course, the department does not go in appeal against the decision.

[Dalia Felix]

sirs,

But, whenever the demand was under GTA, assesse contested that the service is not classifiable there and succeeded the case. (As in the case of Bellary Iron & Ores (P.) Ltd. Versus Commissioner of Central Excise, Belgaum (2009 (12) TMI 150 - CESTAT, BANGALORE) =[2010] 24 STT 557 (BANG. - CESTAT). So can we assume that loading and transportation of ores within the mining area is not taxable, as the activity do not come under any of the taxable services listed then?

AI Summary

Negative list taxation: classification of intra-mine ore transport as mining service or goods transport affects exemption entitlement. Whether transportation of iron ore within a mine is taxable as mining service or classifiable as a goods transport activity under the negative list is contested. A tribunal decision found intra-mine carriage not taxable under mining service, supporting a transport classification. Under the negative list regime services are taxable unless expressly excluded, so one view treats intra-mine transport as taxable for lack of an explicit exclusion; competing authority and prior cases have held such activity falls outside mining service and may qualify for goods transport exemptions, affecting entitlement to the 75 percent exemption and exposure to departmental demands.