2015 (10) TMI 2811 - AT - Service Tax

Levy of service tax - Goods Transport Agency service - purview of transport of goods by road services - services of several transporters for transport of mined coal from coal face to coal stockyards in appellant's own dumpers - Rule 4B of the Service Tax Rules, 1994 - HELD THAT - The definition of Goods Transport Agency in Section 65(50b) clearly specifies that Goods Transport Agency means any person who provides services in relation to transport of goods by road and issues a consignment note by whatever name called. The Explanation under Rule 4B of the Service Tax Rules, 1994 clarifies that consignment note is a document, issued by a goods transport agency against the receipt of goods for the purpose of transport of goods in a goods carriage and contains other specified details. Clearly, as no consignment note as generally understood or delineated in Rule 4B was issued by the transporters to the appellant in the transactions in issue, the classification by the impugned order that appellant received transportation of goods by road service, is unsustainable - Appeal allowed - decided in favor of appellant.

Summary

Issues:
- Appeal against adjudication order confirming demand of service tax for transport of goods by road services without consignment notes.

Analysis:
The appellant, a coal mining company, engaged transporters for moving coal within the mine premises. The adjudication order imposed service tax on the premise that the appellant received transport of goods by road service, defined in Section 65(50a) and (50b) read with Section 65(105)(zzp). The key issue was whether the activity fell within the purview of transport of goods by road services. The appellant argued that since no consignment notes were issued by the transporters, the demand was unjustified.

The definition of "Goods Transport Agency" in Section 65(50b) specifies that it includes any person who provides services in relation to transport of goods by road and issues a consignment note. The Explanation under Rule 4B of the Service Tax Rules, 1994 further clarifies the nature of a consignment note. The Tribunal noted that no consignment notes were issued in the transactions in question, which is a crucial requirement for classifying a service as transport of goods by road. Therefore, the Tribunal held that the classification by the impugned order was unsustainable, leading to the quashing of the order and allowing the appeal.

In conclusion, the Tribunal ruled in favor of the appellant, stating that without the issuance of consignment notes as required by law, the demand for service tax on the transport of goods by road services was not valid. The decision highlighted the importance of adhering to legal definitions and requirements in determining the tax liability for services provided.