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Intercarting goods - service tax

satya (Executive Excise) (1839 Points)

20 July 2012

Dear Experts,

Please clarify the below issue;

The activity is Traactors are using for shifting material from Yard to manfacturing place. per day cost per 1 tractor is appr:2K, Please clarify this intercarting activity comes under "Transportation of Goods by Road" service ?

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3 Replies

Ajit kumar Dubey (Taxation Manager) (637 Points)
Replied 20 July 2012

No, as the company must have taken the tractor on hire and has used the same for transhipment of the material from one place to another within the factory premises, it will considered as right to use of a tangible good and not GTA service

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satya (Executive Excise) (1839 Points)
Replied 20 July 2012

Dear AK Dubey sir,

As per my knowledge Tangible goods defition here I am producing

Scope of Supply of Tangible Goods for Use service-

(1) Transfer of the right to use any goods is leviable to sales tax/ VAT as deemed sale

of goods [Article 366(29A)(d) of the Constitution of India]. Transfer of right to use

involves transfer of both possession and control of the goods to the user of the

goods.

(2) Excavators, wheel loaders, dump trucks, crawler carriers, compaction equipment,

cranes, etc., offshore construction vessels & barges, geo-technical vessels, tug and

barge flotillas, rigs and high value machineries are supplied for use, with no legal

right of possession and effective control. Transaction of allowing another person to

use the goods, without giving legal right of possession and effective control, not

being treated as sale of goods, is treated as service.

There is no Tractor name included in above definition na sir.

Please clarify?

Ajit kumar Dubey (Taxation Manager) (637 Points)
Replied 20 July 2012

Please check the definition once more "cranes, etc., offshore". It will be covered under this part of the definition. As the situation above, while interpreting law when it is practically not possible to name each and every items then it is used as a general sentence.

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