GTA or Business Auxilliary?

[yash banthia]

We have a chain of retail stores which employs transport agencies for distributing FMCG product and Fruits and vegetables from distribution centre to retail stores.I have a confusion about whether these agencies providing Business Aux. Service or GTA service as the service is provided to one entity only?and what would be the service tax implication?

[NEERAJ KUMAR, RANCHI]

In my opinion if the transporter agency is issuing consignment note for each consignment , it should certainly be classified in GTA. Further transportation of fruits and vegetables is exempted service.

AI Summary

GTA classification hinges on issuance of consignment note; transport of fruits and vegetables qualifies for exemption. Classification between Business Auxiliary Service and GTA turns on documentary practice: issuance of a consignment note for each consignment indicates classification as GTA. Transport of fruits and vegetables is treated as an exempted transport service for service tax purposes, so where GTA classification applies to such carriage the applicable exemption governs tax implications.