2024 (10) TMI 1062 - AT - Service Tax

Liability to pay Service tax under the category of goods transport agency service on reverse charge basis - services provided without issuance of a consignment note - Extended period of limitation - HELD THAT - The said issue is no more res integra as the same stands decided by this Tribunal in the case of South Eastern Coal Fields Ltd. v. Commissioner of Central Excise, Raipur 2016 (8) TMI 677 - CESTAT NEW DELHI wherein it has been held ' It is clear that to be called goods transport agency a person should fulfill two conditions, namely, he should provide service in relation to transport of goods by road and issue consignment note, by whatever name called. In the present case, admittedly, no consignment note was issued by the goods transporter. The original authority held that the slip/challans issued for monitoring purposes by the appellant (receiver of service) will satisfy such conditions and tax liability can be upheld.' The appellant has not issued any 'consignment note'. Once it is established that there is no document issued by the transporter in the nature of 'consignment note', the transportation activity cannot be termed as 'Goods Transport Agency service received by the Appellant - the demand of service tax from the Appellant under 'Goods Transport Agency' service on reverse charge basis is not sustainable - the demand of service tax confirmed in the impugned order set aside - Since the demand itself is set aside, the question of imposition of any penalty does not arise. Therefore, the penalties imposed are set aside. Extended period of limitation - HELD THAT - It is observed that extended period of limitation is not invokable, as there is no suppression of facts with intention to evade the tax established in this case. It is found that the Department was in knowledge of the entire facts. It is also observed that the appellant had specifically requested for clarification from the Department vide its letter dated 06.07.2009 on the taxability of the transaction under goods transport agency service. Thus, most of the demand confirmed in the impugned order is not sustainable on the ground of limitation also. The impugned order is set aside - appeal allowed.

Summary

Issues:
1. Whether Service Tax is payable under the category of 'goods transport agency' under reverse charge mechanism.
2. Whether the transportation of ash by the Appellant constitutes 'goods transport agency' service.
3. Whether the demand for Service Tax from July 2009 to March 2013 is barred by limitation.

Analysis:
1. The primary issue in this appeal was whether the Appellant is liable to pay Service Tax under the category of 'goods transport agency' service on a reverse charge basis. The Department contended that the Appellant should pay Service Tax under this category. However, the Appellant argued that the transportation activity does not fall under the definition of 'goods transport agency' service as no consignment note was issued. The Tribunal referred to various case laws and held that in the absence of a consignment note, the transportation activity cannot be termed as 'Goods Transport Agency service.' Therefore, the demand for Service Tax under this category was set aside.

2. The Appellant also argued that ash, being a waste product, does not qualify as 'goods' and therefore the transportation for disposal of ash should not be considered as a taxable service. The Tribunal considered the arguments and held that since no consignment note was issued, the transportation activity for disposal of ash does not fall under the 'goods transport agency' service. The Tribunal relied on previous decisions and set aside the demand for Service Tax related to the transportation of ash.

3. The Appellant contended that the demand for Service Tax from July 2009 to March 2013 is barred by limitation as there was no suppression of facts, and the Department was aware of all relevant details. The Tribunal agreed with the Appellant, noting that the Department was informed about the transaction and there was no intention to evade tax. Therefore, the Tribunal held that the demand for this period is not sustainable on the ground of limitation. Consequently, the impugned order was set aside, and the appeal filed by the Appellant was allowed.