GTA - Hiring of Vehicle on Per Day Basis without any LR

[PAWAN KUMAR SHARMA]

Dear Sir,

Presently, we have a contract with one of Travel Agent who will provide us vehicles on per day basis as and when demanded, the rate is fixed for 8 hrs in a day and for every additional hour, if total hours are more than 8 hrs. The usage of the vehicle is for local movement, movement within the plant.

He is billing us on monthly basis and not charging any tax as his total taxable services are below 10 lacs.

We are also not depositng any service tax on such payments and rather we are deduction TDS under sec 194 C.

I want to clarify that

1. Whether this will come under the preview of GTA or Not ? (considering that there is No LR/Consignment Note for these movements.)

2. Suppose this services are covered under GTA, whether by taking a declaration from the vendor that his services are below 10 lac, can we escaped from the liability of service tax under GTA ?

3. Whether the procedure we are following is correct as per the laws ?

AI Summary

Goods transport agency classification depends on whether the transporter takes charge of goods and issues a consignment note.
GTA status turns on whether the transporter receives goods for transport and issues a consignment note; where the supplier only provides a vehicle without taking charge or responsibility for goods and does not issue consignment notes, the service is vehicle hire rather than GTA, shifting registration and tax collection obligations to the provider, whereas GTA classification can make the recipient liable and requires prescribed invoicing and recordkeeping.