2019 (3) TMI 869 - AT - Service Tax

Classification of services - mining services or GTA Services - transportation of coal through tipper / dumpers to the railway sidings or dispatch points situated within the mines for M/s. South Eastern Coal Fields Ltd. - period from April 2012 to March 2013 - Held that - In the case of H N Coal vs. CCE & ST Raipur 2018 (8) TMI 173 - CESTAT NEW DELHI in which one of the issues considered by the Tribunal was the transportation of coal within the mining area. The Tribunal has taken the view that this activity will be chargeable to service tax only under the category of Goods Transportation Agency service - Even for the period commencing from 01 July 2012 when the negative list regime was introduced, the Tribunal held that the services will continue to be liable for service tax under the category of Goods Transportation Agency service - appeal allowed - decided in favor of appellant.

Summary

Issues:
1. Classification of service for transportation of coal within the mining area.
2. Liability of service tax under different categories for the period from April 2012 to March 2013.
3. Applicability of Goods Transport Agency service classification.
4. Interpretation of relevant legal provisions and case laws.

Analysis:
1. The appeal concerned the transportation of coal from pitheads to railway sidings within mines. The dispute revolved around the classification of this activity for service tax liability. The department argued for taxation under mining services until June 2012 and as a general service thereafter. The appellant contended that it fell under Goods Transport Agency service, citing the recipient's payment of service tax under this category with abatements.

2. The impugned order upheld the demand for service tax, interest, and penalties. The Tribunal heard arguments from both sides. The appellant's consultant referenced previous Tribunal decisions supporting the Goods Transport Agency service classification for the activity, even post-July 2012. The Departmental Representative defended the order.

3. The Tribunal analyzed the case law of H N Coal vs. CCE Raipur, where it was established that transportation of coal within the mining area should be taxed only under Goods Transport Agency service. The Tribunal also referred to a Supreme Court decision supporting this classification. Despite the negative list regime post-July 2012, the Tribunal maintained that the transportation activity continued to be covered under Goods Transport Agency service.

4. The Tribunal concluded that the transportation of coal from the coal face to railway sidings qualified for the Goods Transport Agency service classification, rejecting the department's view of bundling it with mining services for taxation. Consequently, the demand for service tax was set aside, and the appeal was allowed. The decision was based on consistent legal interpretations and the specific nature of the transportation activity within the mining area.