TaxTMI 
TaxTMI 
Dear All,
We have bought a machinery, In the invoice supplier is being charged Machinery cost Plus Vat &
Transportation cost Plus service tax thereon.
My question is that can he charged service tax on transportation cost in the invoice?
Service Tax Charged on the Transportation cost
01 Dec 2011 
3 Replies 
3395 Views Asked by
Guest 
Service tax on transportation: supplier generally cannot charge it on the invoice; the freight payer bears liability.
The supplier is not authorised to charge service tax on GTA services on the face of an invoice; liability for GTA service tax lies with the party who pays the freight. Transportation charges may nevertheless be added to transaction value for central excise where removal is to the buyer's premises or delivery terms are FOR, and excise duty may be computed after adding those transport costs. A supplier paying freight on the buyer's behalf may explain entries but cannot validly pass on GTA service tax as an invoice charge when the freight payer is liable. (AI Summary)
The supplier is not authorised to charge service tax on GTA services on the face of an invoice; liability for GTA service tax lies with the party who pays the freight. Transportation charges may nevertheless be added to transaction value for central excise where removal is to the buyer's premises or delivery terms are FOR, and excise duty may be computed after adding those transport costs. A supplier paying freight on the buyer's behalf may explain entries but cannot validly pass on GTA service tax as an invoice charge when the freight payer is liable. (AI Summary)