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2017 (5) TMI 398 - AT - Service TaxGTA service - mining of coal in various coal fields - recipient of service - reverse charge mechanism - main issue of present case is non-issue of consignment note and implication of such consignment note for tax liability to be fastened on the appellant - Held that - as no consignment note as generally understood or delineated in Rule 4B was issued by the transporter to the appellant in the transaction the tax liability under GTA does not arise. - Decision in the case of South Eastern Coal Fields Ltd. vs. CCE, Raipur 2016 (8) TMI 677 - CESTAT NEW DELHI followed. Appeal allowed - decided in favor of appellant.
Issues:
Liability of appellant to pay service tax on reverse charge basis as a recipient of service under the category of Goods Transport Agency. Analysis: The judgment revolves around the liability of the appellant to pay service tax under the category of Goods Transport Agency (GTA) on a reverse charge basis. The appellant, engaged in coal mining, had agreements with transporters for coal transportation. The dispute centered on the issuance of consignment notes and the implications for tax liability. The Tribunal held that the appellant is not liable to pay service tax on GTA services, citing precedents and legal provisions. However, the Revenue appealed to the Supreme Court, leading to a remand for fresh proceedings. The Tribunal examined the case separately due to a denovo order passed in a related matter. The appellant argued that based on previous decisions, the impugned orders should be set aside as the consignor and consignee were the same, and no consignment note was issued for coal transportation within mining areas. The Original Authority confirmed the service tax liability on the appellant, considering the truck authorization slip issued by the appellant as fulfilling the consignment note requirement. However, the Tribunal disagreed with this interpretation, citing a previous case where the absence of consignment notes from transporters did not establish the appellant as a GTA. The Tribunal emphasized that the legal provisions define a GTA as a person providing services in relation to goods transportation by road and issuing a consignment note. The absence of a consignment note from the transporter did not justify imposing tax liability on the appellant under the reverse charge mechanism. The Tribunal's decision was supported by various precedents and legal interpretations. It was noted that the appellant's issuance of slips for monitoring purposes did not meet the criteria for a consignment note. The Tribunal highlighted that the absence of consignment notes precluded the transporter from being classified as a GTA. The appellant's argument regarding the time bar for the demand was also considered, emphasizing the lack of clarity in circulars issued by the Board regarding tax liability in such cases. Ultimately, the Tribunal concluded that the tax liability under GTA service could not be sustained against the appellant, setting aside the impugned orders and allowing the appeals. In conclusion, the judgment clarifies the criteria for tax liability under the GTA category, emphasizing the necessity of consignment notes for establishing such liability. The Tribunal's decision was based on legal provisions, precedents, and a thorough analysis of the facts and circumstances of the case, ultimately ruling in favor of the appellant and setting aside the service tax liability.
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