The Allahabad bench of Customs, Excise And Service Tax Appellate Tribunal (CESTAT) has held that Transporters/contract Services in mines cannot be GTA in the absence of a consignment note and service Tax not leviable. The tribunal found that the essential requirement is the issuance of consignment notes to be covered under the definition of GTA and in the absence of the same, the transporters/contractors rendering transport services in mines cannot be said to be GTA.
Shri M.B. Mathur appeared for the Appellant and Shri Manish Raj, Authorised Representative for the Respondent
On receipt of specific intelligence against the appellant, Shri Dharmraj Singh it was observed that the appellant entered into a specific contract/agreement executed with the Regional Food Controller [District Supply Officer/ District Marketing Officer] provided services by way of Transportation of Food Grains from various godowns to the individual PDS Shop and/or other destination contained in such contract/agreements. Revenue was of the view that services provided by the appellant were classifiable under the category of GTA.
Show cause notice was issued to the appellant asking them to show cause as to why the service tax amounting to Rs.61,94,880/- (Sixty one lakhs ninety-four thousand eight hundred eighty only) should not be demanded and recovered from them alongwith appropriate Interest under the proviso to Section 73 (1) of the Act r/w Section 75 of the Act. The said show cause notice was adjudicated as per the impugned order.
The issue is whether the appellants were engaged in providing services under the category of Transport of Goods by Road Service without obtaining the registration and payment of due service tax.
It was evident that the appellant was not issuing any consignment note which is an essential requirement for classification of their services under the category of GTA. This fact about not issuing of consignment note is not disputed by the revenue that being so the services provided by the appellant cannot be classifiable under the category of GTA services for making the demand of service tax. Adjudicating authority in the impugned referred to certain documents which though were not consignment notes etc., to hold that these documents are consignment notes.
The Tribunal viewed that the other orders relied upon by the Consultant clearly confirm the view that the essential requirement is the issuance of consignment note in order to be covered under the definition of GTA and in the absence of the same, the transporters/contractors rendering transport services in mines cannot be said to be GTA and therefore, their service cannot be made amenable to the levy of Service Tax under the category of “transportation of goods by road” service.
A two-member bench of Mr P K Choudhry, Member (Judicial) and Mr Sanjiv Srivastava, Member (Technical) held that the demand of Service Tax confirmed in the impugned order cannot sustain and set aside the same.
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