TaxTMI 
TaxTMI 
2024 (1) TMI 721
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.... finished goods or capital goods in local nearby area, from the private tractor owners, who used their tractors mainly for the agriculture purpose, but casually undertake transportation of gas cylinders in tractor trolley for the appellant. The case of the department is that since the appellant have availed the GTA service, they are liable to pay Service Tax under reverse charge mechanism on the freight paid by them to the tractor trolley owners who provided their transportation to the appellant. 2. Shri Shaurabh Dixit, Learned Counsel appearing on behalf of the appellant submits that in this case the service of the transportation availed is not from the organized transport agency but directly from the tractor trolley owners, who otherwise carry out the transportation of agricultural produce but at time they provide the transportation service and for that they do not issue any LRs/Consignment notes. Therefore, the service does not fall under the 'goods transport agency service'. Hence, not liable to service tax in the hands of the appellant as a service recipient. He placed reliance on the CBIC Circular and judgments as follows: * CBIC Circular No. 95/6/2007-ST dated. 11.06.07 ....
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....rvice in relation to transport of goods by road and issues consignment note by whatever name called Section 65(105) (zzp) to a customer, by a goods transport agency, in relation to transport of goods by road in a goods carriage" 4.1 He held that by virtue of the above provisions, the service received by LMC was exigible under the category of "GTA". He found that the providers of service involved were commercial concerns engaged in the business of transportation of goods in a goods carriage by road. These facts were not in dispute. A couple of bills seen by him indicated that the tax liability was abated from the mutually agreed amount for transport of consignments. He held that goods transport agency themselves could be the owner of the trucks/operators. 5. The appellants had mis-declared the actual taxable value in the ST-3 returns. This warranted invocation of proviso to Section 73(1) of the Act. The plea that penalty was not justified since the appellants had discharged tax liability before issue of show cause notice, was rejected relying on the following judgments of the High Court : (a) CCE & C Aurangabad v. Padmashri V.V. Patil S.S.K. Ltd. - 2007 (215) E.L.T. 23 (Bom-H.....
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....In the circumstances, we set aside the impugned order and hold the appellants not liable to Service tax under the category of GTA during the material period and allow this appeal." b) The above decision of the Tribunal was upheld by the Hon'ble Karnataka High Court reported at Lakshminarayana Mining Company 2012 (26) STR 517 (Karnataka), whereby, an appeal against the aforesaid Tribunal order was dismissed by the Hon'ble Karnataka High Court: "4. This appeal was admitted to consider the following substantial questions of law : (i) Whether the order of the CESTAT, based solely on the speech of the Hon'ble Finance Minister made while introducing the Finance Bill, 2004 and not as per the statutory provisions of law was right in holding that the Respondents were not liable to pay Service Tax under the category of "GTA" ? (ii) Whether the order of the CESTAT was right in holding that the Respondents were not liable to Service Tax under the category of "Goods Transport Agency", contrary to the statutory provisions of law i.e., Section 65(105)(zzp), Section 65(50b), Rule 2(1)(d)(v) of the Service Tax Rules, 1994 & Notification No. 35/2004-S.T. dated 3-12-2004 w.e.f. 1-1-2005 and t....
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....uring the period in dispute, the taxable service, in relation to transport of goods in a goods carriage, means any service provided or to be provided to a customer by a goods transport agency service. We note that the term 'goods transport agency' has been specifically defined in Section 65(50b) to mean any commercial concern which provides service in relation to transport of goods by road and issues consignment note, by whatever name called. 10. On perusal of the above statutory provisions, it is clearly evident that in order to constitute 'Goods Transport Agency', the provider of transportation service must issue the consignment notes or any other document by whatever name called. We find that the issue has already been examined in detail by the Tribunal, in Final Order dated 13-8-2014, in South Eastern Coalfields Ltd. v. CCE, Raipur 2016 (41) S.T.R. 636 (Tri. - Del.), the relevant portion is reproduced below :- "...5. If the transaction/service provided by the 24 transporters to the appellant fall within ambit of Goods Transport Agency service within the meaning of the aforesaid provisions, the appellant would be liable to tax though being recipient of the service is not con....
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....te, in order to constitute "Goods Transport Agency" as has been specifically defined in the Act, was not the subject matter of examination so as to decide the taxability in the hands of assessee receiving goods transportation services and therefore, the aforesaid Apex Court's decision has no application in the instant case. 13. We find it worth taking note of the observation made by the Tribunal in JWC Logistics Pvt. Ltd. (supra) as below : "8. It is not the transportation of goods byroad that is subject to tax but the services rendered by a goods transport agency in relation to the transportation of goods by road and road transport agency tasked with responsibilities that others connected with road transport are not, with consignment note being the point of difference. There is also no doubt that Rule 4B of the Service Tax Rules, 1994 lays down the contents of a consignment note." 14. In view of the above discussions and the decisions cited (supra) and taking into consideration the essential requirement of issuance of 'consignment note', in order to attract the definition of "Goods Transport Agency", we hold that the transport contractors rendering the coal transportation se....