2024 (2) TMI 1252 - AT - Service Tax

Levy of service tax - GTA Service - Consignment Note not issued - HELD THAT - The Tribunal in catena of decisions have held that issuance of Consignment Note is pre-requisite for taxability under GTA services. The Tribunal have categorically laid down the law that in absence of consignment note services cannot be considered as GTA services and the demand of service tax under the category of Goods Transport Agency does not sustain. Reference is invited to the decisions in DINSHAWS DAIRY FOODS VERSUS COMMISSIONER OF CENTRAL EXCISE, NAGPUR 2018 (4) TMI 912 - CESTAT MUMBAI and M/S. MAHANADI COALFIELDS LTD. VERSUS COMMR. OF CENTRAL EXCISE SERVICE TAX, BBSR-I 2019 (7) TMI 1803 - CESTAT KOLKATA . In Mahanadi Coalfields Ltd. it was held that The issue of consignment note, is a non-derogable ingredient to make the goods transporter as Goods Transport Agency as defined in the statute. From the facts of the present case, it is found that the appellant apart from running the petrol pump outlet is also providing the transportation of petroleum pump on behalf of M/s BPCL, the service receiver and M/s BPCL has issued a certificate mentioning that service tax has been discharged by them on monthly basis being the person liable to pay tax on services received under Goods Transport Agency as per the provisions of the Finance Act. Therefore, the service tax liability has been discharged by the service receiver and consequently the appellant is not liable to discharge the same once again. In the present case, it is found that it is an undisputed position that the appellant had not issued any consignment notes by whatever name and hence in view of the law laid down by the series of decisions, no service tax liability can be imposed. The demand proposed in the show cause notice for recovery of service tax of Rs. 1,69,003/- along with interest and penalty is liable to be dropped and the impugned order needs to be set aside - Appeal allowed.

Summary

Issues Involved:
The issues involved in the judgment are whether the appellant is liable to pay service tax for providing transportation services without issuing consignment notes and whether the service tax liability has already been discharged by the service receiver.

Comprehensive details of the judgment for each issue involved:

Issue 1: Liability to pay service tax without issuing consignment notes
The appellant, running a petrol pump outlet and providing transportation services, argued that no service tax is chargeable as the essential requirement for "Goods Transport Agency" services, i.e., issuance of consignment notes, was not fulfilled. The Tribunal cited various decisions emphasizing the necessity of consignment notes for taxability under GTA services. Referring to the case of Bharat Swabhiman (Nyas) Vs. Commr. Cus., C. Ex. & ST, Dehradun, it was held that without consignment notes, activities cannot be considered under GTA services. The judgment in CCE Vs. JWC Logistics Pvt. Ltd. highlighted the legal significance of consignment notes in creating liability and responsibility in transportation services.

Issue 2: Discharge of service tax liability by the service receiver
The appellant contended that the service receiver, M/s BPCL, had discharged the service tax liability under reverse charge mechanism and provided a certificate to that effect. The Tribunal examined the statutory provisions and held that since the service receiver had already paid the service tax under Goods Transport Agency, the appellant, as the owner of the truck providing transportation services, fell under the exemption in the negative list of services. As the appellant had not issued any consignment notes, the Tribunal ruled that no additional service tax liability could be imposed.

In conclusion, the Tribunal found in favor of the appellant, holding that the demand for recovery of service tax, interest, and penalty was not sustainable. The impugned order was set aside, and the appeal was allowed.