2009 (5) TMI 376 - AT - Service Tax

Transport of goods-Freight Charges- The appellants are manufacturer of gases. They used their own vehicle for transporting the gas cylinders to the premises of the buyers on collection of freight charges. Revenue held that the appellant would be liable to service tax under the category of GTA. In the light of judgment of MSPL Ltd. v. CCE 2009 -TMI - 32448 - CESTAT, BANGALORE, held that the appellants transport the goods in their own vehicle to the buyer. The buyer is a person who actually pays freight, thus the liability to pay service tax is on the person who pays the freight, thus appeal is allowed.

Summary

The Appellate Tribunal CESTAT, Bangalore, in the 2009 (5) TMI 376 case, comprised of T.K. Jayaraman, Technical Member and M.V. Ravindran, Judicial Member. The appellants, manufacturers of gases, were transporting gas cylinders to buyers using their own vehicle and collecting freight charges. The revenue argued that the appellants were liable for service tax as Goods Transport Agents (GTAs). However, the Tribunal referenced a previous case and ruled that only the person who pays the freight is liable for service tax, which in this case was the buyer. Therefore, the appellants were not liable for service tax. The Tribunal allowed the appeal and disposed of both the stay application and appeal accordingly. This judgment clarifies the liability for service tax in cases where goods are transported by the owner's own vehicle.