2020 (3) TMI 851 - AT - Service Tax

Maintainability of appeal - incorporation of additional grounds in the appeal - Rule 10 of CESTAT Procedure Rules,1982 - Refund of service tax - service tax paid on transportation of iron ore, from the mining site to the appellant s crusher plant, located 6 km away from mining area - reverse charge mechanism - Section 11B of the Central Excise Act,1944 as applicable to service tax vide Section 83 of the Finance Act,1994 - HELD THAT - In view of the specific provision under Rule 10 of the CESTAT Procedure Rules, we are inclined to entertain the misc. applications, seeking incorporation of additional grounds. The misc. applications are allowed, which have substantial bearing on the main appeals. On going through the relevant documents, such as, the contract between the appellant and the raising contractors, the monthly bills raised by them on the appellant, the transit pass in Form-G , issued by the mining authority for the purpose of payment of mining royalty, and transportation of iron ore from the mines site. The raising contractors have not issued any other document in the name of the appellant, for the purpose of transportation of iron ore, which can be termed as a consignment note, as stipulated under Rule 4B of the Service Tax Rules,1994, as amended. As per the legal principles decided by different benches of Tribunal and relied upon by the appellant, the activities of transportation of iron ore in the present case, do not fall under the GTA service in terms of Sec.65(105)(zzp) of the Finance Act,1994, nor the raising contractors fall under the definition of GTA as defined under Sec.65(50b) of the said Finance Act. Appeal allowed - decided in favor of appellant.

Summary

Issues:
Refund of service tax on transportation of iron ore, applicability of Exemption Notification No.34/2004-ST, classification of transportation service under GTA service.

Analysis:
1. The appellant filed refund applications under Sec.11B of the Central Excise Act,1944 for service tax paid on transportation of iron ore. The transportation was from the mining site to the crusher plant located 6 km away, undertaken by third-party contractors. The appellant paid service tax under reverse charge mechanism as per Goods Transport Agency (GTA) service definition.

2. The appellant believed the service tax was not payable based on Exemption Notification No.34/2004-ST and filed refund applications. The Jurisdictional Asst. Commissioner rejected the claims, leading to appeals before the Commissioner (Appeals), who upheld the rejection, resulting in the appeal before the Tribunal.

3. The appellant sought to incorporate additional grounds during the appeal, arguing that the transportation of iron ore did not constitute GTA service as per the Finance Act,1994. They highlighted the absence of consignment notes, essential for GTA service classification, and relied on legal precedents supporting their stance.

4. The Tribunal allowed the incorporation of additional grounds, considering their substantial bearing on the main appeals. After reviewing the documents and legal principles, the Tribunal found that the transportation activities did not fall under GTA service definitions. The orders rejecting the refund claims were set aside, and the appeals were allowed with consequential relief.

5. The Tribunal pronounced the order on 17 March 2020, overturning the previous decisions and granting relief to the appellant in accordance with the law.

This detailed analysis covers the issues of refund claims, Exemption Notification applicability, and the classification of transportation services, providing a comprehensive overview of the legal judgment delivered by the Appellate Tribunal CESTAT KOLKATA.