2018 (4) TMI 1040 - AT - Service Tax

Classification of services - appellants were only loading timber logs from the port area and lift them into truck/trailers and transported it to area situated in the ranges of around 50 to 60 km - GTA Service or Cargo Handling service? - extended period of limitation - CBEC Circular No. 104/7/2008-ST dated 6.8.2008 - Held that - appellant are primarily involved in loading/unloading of timber logs into the truck/trailer and transport of the same to the nearby location of the importer - they are issuing consignment note for these transportations and they are discharging duty liability under the category of GTA. Reliance also placed in the case of RK. TRANSPORT COMPANY Versus COMMISSIONER OF CENTRAL EXCISE, RAIPUR 2012 (3) TMI 271 - CESTAT, NEW DELHI , where it was held that The definition of cargo handling service includes cargo handling incidental to freight. The definition does not specifically include transportation. It specifically excludes mere transportation. So the definition cannot be interpreted to mean that if a transporter who transports goods for 460 KM does loading and unloading also, the service rendered by the transporter will no longer be transportation but cargo handling service. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Confirmation of demand and imposition of penalty based on the nature of services provided by the appellant.

Analysis:
The appellant, engaged in the transportation of wooden logs, argued that they were primarily involved in loading/unloading the logs into trucks and transporting them to the importer's premises. They contended that they were discharging duty liability under the category of Goods Transport Agent (GTA) services and issuing consignment notes. The appellant relied on CBEC Circulars to support their position that ancillary services like loading/unloading provided in relation to road transportation should be considered part of the GTA service. The appellant also argued that the demand was time-barred, citing relevant case laws to assert that the extended period of limitation cannot be invoked.

The Revenue, however, relied on the impugned order without presenting any new arguments.

The Tribunal considered the submissions and noted that the appellant's main activity was loading/unloading and transporting goods, for which they issued consignment notes and discharged duty liability as a GTA. The Tribunal referred to CBEC Circulars to support the view that ancillary services in relation to road transport should be treated as part of the main service. The Tribunal also highlighted a CBE&C clarification that emphasized the composite nature of services provided by GTAs, including ancillary services. The Tribunal further referenced a previous case to establish that transportation activities with incidental loading/unloading do not amount to cargo handling services. Based on the above analysis and legal principles, the Tribunal found merit in the appellant's arguments and allowed the appeal, considering it covered by relevant clarifications and judicial decisions.

Therefore, the Tribunal allowed the appeal, concluding that the appellant's activities fell within the scope of GTA services, considering the nature of services provided and the relevant legal clarifications and precedents cited during the proceedings.