Clarification of abatement under GTA services

[Guest]

We have taken service tax registration for payment of service tax under GTA as an availer of service. Excise authorities have issued showcause notice stating that abatement under notification no. 32/2004. is available only for Goods transport agency and not for the person who avails such service. As per the provisions of Service Tax, for GTA the availer has been made liable to pay service tax (if he satisfies the conditions of categories of assessees mentioned in the notification) which implies that they are also eligible for abatement of 75% allowed under the notification. Please clarify.

AI Summary

Service Receiver Entitled to 75% Abatement on Goods Transport Agency Services Under Notification 32/2004, Disputing Excise Stance A query was raised regarding the eligibility for abatement under notification no. 32/2004 for service tax on Goods Transport Agency (GTA) services. The excise authorities issued a showcause notice stating that the abatement is only available to the GTA, not the service receiver. The inquirer argued that as per Service Tax provisions, the service receiver liable for tax should also be eligible for the 75% abatement. A respondent confirmed that the excise authorities' stance is incorrect, and the service receiver has a strong case to claim the abatement benefit.