No Service Tax Leviable on Transportation of ‘Food Stuff’ towards GTA expenses: CESTAT [Read Order]

The Kolkata bench of the Customs, Excise, and Service Tax Appellate Tribunal (CESTAT) held that when ‘foodstuff’ was transported, the same would be exempted from payment of Service Tax towards GTA expenses. 

Bansal Biscuits Private Limited, the appellant assessee are manufacturer of biscuits and apart from being registered under Central Excise, they are also registered with Service Tax Authorities for paying Service Tax under the Reverse Charge Mechanism for the Goods Transport Agent (GTA) services utilized by them. They were paying Service Tax on a Reverse Charge basis on GTA Services. 

The assessee appealed against the order passed by the Adjudicating Authority for rejecting the refund claim under Section 11B of the Central Excise Act read with Section 83 of the Finance Act, 1994. 

Ankit Kanodia and Megha Agarwal, the counsels for the assessee contended that after noticing that they have paid Service Tax which was not required to be paid because of exemption granted under Notification No.25/2012- ST dated 20/06/2012 as amended by Notification No. 03/2013-ST. 

Also submitted that the refund claim was eligible for the assessee in which the service tax was paid by mistake. 

K. Chowdhury, the counsel for the department relied on the decisions made by the lower authorities and contended that the denial of refund was as per the law and liable to be sustained. 

The Bench observed that as per Notification No. 25/2012-ST dated 20/06/2012, when ‘foodstuff’ was transported, the same would be exempted from payment of Service Tax towards GTA expenses. 

The two-member bench comprising Muralidhar (Judicial) and Anpazhakan (Technical) held that there was no necessity to go into the aspect as to whether the biscuits can qualify as foodstuff to be eligible for the exemption. 

To Read the full text of the Order CLICK HERE

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