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TMI BlogGoods Transport Operator Services – No confusion in the law – but why Mr. P Chidambaram’s army is so confused?X X X X Extracts X X X X X X X X Extracts X X X X ..... Goods Transport Operator Services – No confusion in the law – but why Mr. P Chidambaram’s army is so confused? X X X X Extracts X X X X X X X X Extracts X X X X ..... availing services of GTA and liable to pay service u/s 68(2) and availing the benefit of abatement equal to 75% under notification no. 34/2004. Let us have a look on the developments related to Service Tax on Goods Transport Operator Services:- 1 Service Tax on Goods Transport Agencies was introduced initially with effect from 16-11-1997 but was struck down by the Supreme Court as ultravires. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2 After removing the restriction in the statute, the Central Government has once again introduced the service tax on Goods Transport Operator Services with effect from 1-1-2005 by Finance (No. 2) Act, 2004. 3 For this purpose, various notifications and instruction have been issued. (relevant provisions) 4 According to the provisions of Section 68(2) and Rule 2(1)(d) of the Service Tax Rules, 19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 94, the liability of service tax shifts to the recipient of services (consignee or consignor) if they are among the specified persons. 5 On the other side, notification no. 32/2004 ST dated 3-12-2004 has been issued to exempt 75% (abatement) of the value of services where the goods transport operator does not avail the benefit of Cenvat Credit. (Now the notification no. 1/2006 ST dated 1-3-2006 - ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Sr. no .6) 6 Now, a pertinent question has been arisen that whether the specified persons (i.e. Consignor or consignee) are also eligible for availing the abatement of 75%. 7 Since there is no restriction in the notification and on the basis of principle of equality it was found that the specified persons are also eligible for such exemption. 8 On the contrary, the Director General of Service ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tax (DGST) has issued an instruction dated 30-3-2005 to the service tax department for not allowing the benefit of 75% abatement to the specified person (i.e. consignor or consignee). 9 But, the DGST has found the above instruction wrong and has withdrawn the same vide its letter dated 4-11-2005. But such letter was not been circulated publicly, DGST has issued another letter dated 3-4-2006 confi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rming that the earlier instructions dated 30-3-2005 had been withdrawn. 10 Further, the TRU, in its letter F. No. B 1 /6 /2005 TRU dated 27-7-2005 - Paragraph no. 31, has confirmed that the benefit of abatement of 75% is available to the specified persons (consignee or consignors) From the above discussions, it is very much clear that the consignee or consigner who is liable to pay service tax o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n GTO services are eligible for abatement of 75% than why the officer of central excise department are so confused and continue to issue show cause notices to the persons availing benefit of 75%.
Do you need any other example of harassment? X X X X Extracts X X X X X X X X Extracts X X X X
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