Service tax on transportation of goods by road

[Sudhir Kumar]

I am a businessman and earn some income by transportation of goods by own truck, during filing income tax return inadvertently I have filled the amount of income from sale of service in place of sale of goods. At present I have no document except profit and loss account, balance sheet and Form 3CD of Income tax which I have submitted to the service tax department. Service tax department has issued notice by alleging that I was involved in the activity of ' Supply of tangible goods' as I have not produced any documents which prove the activity, transportation of goods by road. Please guide, which documents I should provide to the department satisfying that service provided by me fall under the negative list.

[KASTURI SETHI]

Sh.Sudhir Kumar Ji,

The documents i.e. profit and loss account, balance sheet and form 3CD of Income tax are statutory documents. These are based on your books of accounts.The department should rely on you. Committing a procedural lapse or typographical mistake on invoice does not mean you should pay ST. These are sufficient for providing taxable service or exempted service, if you have committed a mistake while preparing invoice. I think you have received a simple letter and not show cause notice. Pl.confirm what you have actually received from the department.

[Sudhir Kumar]

Sir, I have received a Show Cause notice in which allegation has been made by the department that I have supplied the Tangible goods which is taxable because I have not submitted any invoice/challan or any documents in respect of transporation of goods by road hence activity carried on by me is treated as supply of tangible goods as department mentioned in notice.

[KASTURI SETHI]

Can you post major contents of the SCN here or can you email copy of SCN ?

[Sudhir Kumar]

Ok sir, I will mail you.

[KASTURI SETHI]

You have not emailed copy of SCN. My email ID is klalsethi@gmail. com

[navnath padwal]

if allegation is of ' Supply of tangible goods' then how can officer ask for Service tax?

[KASTURI SETHI]

Without reading SCN between the lines, nothing can be said about who is in the wrong whether the noticee or the department ? Full facts are not known to the experts. The department does not issue SCN without any basis. There is a proper procedure for issuance of SCN. There are stages and every officer puts his/her signature from the rank of Inspector, Supdt., Assistant Commissioner/Deputy Commissioner, Joint Commissioner, Addl.Commissioner,Commissioner (depending upon competency/amount of duty etc.Whether the ingredients of mens rea involved or not ).

AI Summary

Service tax classification: mischaracterisation as supply of goods may trigger show-cause notice; accounting records can evidence transport service. A road-transport operator mistakenly reported receipts as sale of goods and received a show-cause notice alleging supply of tangible goods; statutory records (profit & loss, balance sheet, Form 3CD) were submitted. Advisers indicate those books of account and Form 3CD can substantiate that the activity is transport service falling within the negative list/exemption, but recommend reviewing the specific contents of the show-cause notice and, where possible, providing transport documentation (invoices, challans, logbooks) to corroborate the nature of the service.