Taxablity of transportation service

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ABHINAW TIWARY (Querist)
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11 May 2013 Firm'A' is in transpot business & Firm 'B' does mining & Crushing of Iron ores. Firm 'A' transports the iron ores of Firm'B' from it's mines to it's crusher plants. Is service tax applicable to firm 'A' (the transporter) in such type of transport service ?? Please reply in details.

Thanks & Regards

Arvind Tiwari

Arvind Tiwari (Expert)
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12 May 2013 Dear Tiwary,

To become GTA service, the GTA service provider should issue Consignment note as given under Rule 4B of Service Tax Rules 1994. It should contain the following
1) Name of the Consignor
2) Name of the consignee
3) details of the place of origin & destination with the goods being transported
4) Mention service tax category as “Goods Transport Agency” along with Service Tax Registration No
5) Registration No. (truck/trailer no as allotted by RTO) of the goods carriage in which goods are transported
6) Person liable for paying service tax is Consignee

You service can also fall under Supply of Tangible goods, if you are not issuing consignment note & not amount to transfer of right to use .

If you are providing Transportation activity exclusively to one it can also fall under the “Transfer of right to use as per article 366(29-A)” (subject to condition, Please refer case of State of Andhra Pradesh v/s GS Lamba) which will invite State VAT.

Please assess your case & decide.

Arvind Tiwari
09322368699

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ABHINAW TIWARY

ABHINAW TIWARY (Querist)
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14 May 2013 But in my case there is only one entity whose goods are being transported. Can the same be construed as consignor at it's mines & consignee at it's crusher and service tax be levied ?? As far as rule 4B is concerned, it talks about 'a consignment note by whatever name may be called' so can we stand to non levy of Service tax by saying that no such note is prepared or the invoice raised by the transporter would be construed as consignment note.. Actually I am looking for a reasonable ground for levy or non levy of tax, as the case may be. Please clear my doubt.

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