By TIOL News Service

MUMBAI, DEC 01, 2017: THE Appellant had engaged M/s New Konkan Transport and M/s Yashashree Transport for transporting of clinker, which is their raw material for manufacture of Cement from Bhagwati Bunder jetty to the factory for which the Appellants issued work orders with specific terms & Conditions which stipulated that the responsibility / custody of the raw material (clinker) will be with transporter until the goods are unloaded in the factory premises of the Appellants.

SCN was issued alleging that the Appellant failed to include the value of the said services and have also failed to pay Service Tax under category of transport of goods by road in respect of freight paid by them to above said transport agencies during the period Jan2010 to Jan 2011.

The demand was confirmed by lower authorities and an appeal came to be filed before the CESTAT.

It is submitted that the service provider had not issued any consignment note and hence they will not be covered under the scope of Goods transport Agency. On the very same issue in Appellants own case this tribunal in Appeal No. ST/412/12-MUM for previous period held such service is not taxable under Reverse Charge Mechanism in the hands of the Appellant. Following case laws are also cited in support -

a. Western Coal Field Ltd. Vs CCE, Nagpur - 2015-TIOL-1289-CESTAT-MUM

b. South eastern Coal Field Ltd. Vs CCE, Raipur - 2014-TIOL-1554-CESTAT-DEL

c. Bhima Sahakari SakharKar khana =  2015-TIOL-2134-CESTAT-MUM

d. Lakshminarayan Mining Co. Vs CCE Banglore=  2010-TIOL-122-CESTAT-BANG

e. Bhima Sahakari Sakhar Karkhana =  2015-TIOL-2134-CESTAT-MUM

f. Bellary Iron VsCCE, Belgaum -  2010-TIOL-704-CESTAT-Bang .

g. KMB Granites Pvt. Ltd. =  2010-TIOL-611-CESTAT-MAD

h. Kanaka Durga Agro Oil Products -  2009-TIOL-1123-CESTAT-Bang

Furthermore, as the transporter charged per trip less than Rs. 750/-,same is exempted from payment of Service Tax in terms of Notification No. 34/2004-ST .

That if Service Tax is payable on GTA, the amount of such service tax is available as cenvat credit to the Appellant and the entire exercise is revenue neutral.

The AR reiterated the findings of the lower authorities.

The Bench observed that in an identical case of the Appellant themselves the Tribunal had vide order No. A/86183/17/STB, dt.08.02.2017 [2017-TIOL-2714-CESTAT-MUM] passed an order setting aside the tax demand.

In the said case, the CESTAT had while allowing the appeal held thus –

ST - Whether the appellant is required to discharge service tax liability under GTA on reverse charge basis for the period 01.01.2005 to 31.12.2009 in respect of amounts paid by them to two transport companies for movement of material i.e. 'clinker' from their own jetty to the cement manufacturing premises – lower authorities held against the appellant, therefore, appeal before CESTAT. Held: In the records it is nowhere mentioned that these two transport companies issued consignment note either individually or jointly for the movement of the cement clinkers from jetty to the manufacturing premises of the appellant – as per rule 4B of the STR, 1994, the goods transport agency shall issue consignment note to respondent in relation to the transport of goods in a road carriage – from the Explanation to the rule, it is clear that the consignment note should have specific particulars, therefore, interpretation by lower authorities that any document, by whatever name, needs to be considered as consignment note is misplaced as in this case the transporting companies have only raised invoices for transportation of cement clinkers as per the contract and which did not satisfy the requirement of consignment note – it cannot, therefore, be said that Goods Transport Agency services are rendered – impugned order is unsustainable, hence set aside & appeal is allowed: CESTAT [para 6.2, 6.3, 6.5]

Following the same, the Bench opined that the issue was no longer res integra .

The impugned order was set aside and the appeal was allowed.

(See 2017-TIOL-4224-CESTAT-MUM)