While upholding an order of the Authority for Advance Ruling (AAR), the appellate authority held that the Goods and Services Tax ( GST ) is payable on the transit fee collected by the Forest Division from the non-government, private and commercial vehicles engaged in mining work for the use of forest road.
Earlier, the Advance ruling authority found that the said “Abhivahan Shulk” is charged and collected by the applicant in respect of forest produce carried out by a person.
Ongoing through “The Uttrakhand Transit of Timber and Other Forest Produce Rules 2012”, the authority observed that a person who desires to obtain forest produce is required to be registered with the forest department after paying applicable fee and the said “Abhivahan Shulk” is charged on the basis of quantum and quality of forest produce and the said forest produce must be accompanied with a transit pass issued by forest authorities in this regard. It was further observed that charges for carrying forest produce through road or water are different and determined according to quality and quantity. Therefore, said, “Abhivahan Shulk” cannot be termed as toll tax and rather is a form of consideration received by the applicant in lieu of services provided to the person for carrying forest produce.
The Authority further found that since the services provided by the applicant did not find mention in the list of exempted services, therefore the applicant was liable to pay GST @ 18% on the said “Abhivahan Shulk” under Service Code 9997 and was to be treated as “other services”.
Upholding the AAR order, the appellate authority held that the Abhivahan Shulk cannot be covered under notification relating to “NIL” rate nor does it correspond to an entry for services that are taxed at 24%. Hence, this fee has to be covered under the residuary I leading 9997 for other services with the tax rate of 18% GST.
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