9911796707
TMI BlogTRANSPORT OF GOODS THROUGH PIPELINE SERVICESX X X X Extracts X X X X X X X X Extracts X X X X ..... TRANSPORT OF GOODS THROUGH PIPELINE SERVICES X X X X Extracts X X X X X X X X Extracts X X X X ..... n received from any person in relation to transport of goods through pipeline services shall be chargeable to service tax. Meaning of Transport of Goods through Pipeline or Other Conduit The statutory provision of service tax does not define what is meant by transport of goods through pipeline or conduit. With the levy of service tax on goods being transported through a pipeline or conduit, no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w only goods transportation by train is out of service tax net. Transportation of goods by air and by road are already covered. Transportation of goods through pipeline or conduit should meet the following tests: (a) transportation of goods should take place. (b) such transportation should be through a pipeline or other conduit. (c) service must be provided by any person to another person. Tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able Service Section 65(105)(zzz) defines taxable service as under -- "any service provided or to be provided to any person, by any other person in relation to transport of goods other than water, through pipeline or other conduit". To be covered under a taxable service, following conditions must be satisfied-- (a) transportation of goods should take place. (b) goods transported should be t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hrough any pipeline or other conduit. (c) transportation of water is excluded. (d) transportation of goods should be on behalf of other person. (e) service rendered should be for a consideration and not a free service. It appears that what could be transported through pipeline or conduit are generally gases or liquids. Since water has been specifically excluded, all types of gases and fuels, o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther chemicals and liquids etc. shall be covered. Though milk is specifically exempt under road transportation, no specific exemption of milk exists in case of transportation through pipeline or conduit. Examples of goods may include petrol, diesel, other liquid fuel, Piped Natural Gas (PNG), Compressed Natural Gas (CNG), Liquefied Natural Gas (LNG) etc. It may be noted that service tax is not on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods sold through pipeline (like cooking gas) but is on transportation done or undertaken through a pipeline, on behalf of other person for a consideration. Pipelines or conduits are generally laid on or under the surface. Service provider could be any person including an individual. The taxable service would not include transportation of water in tankers as water has been specifically excluded ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from its scope. However, if water is transported and freight is paid to goods transport agency say, in case of industrial water or otherwise, service tax shall be payable on such freight. In Oil India Ltd v. CCE, Dibrugarh 2008 -TMI - 30942 - (CESTAT KOLKATA), where transportation of crude oil was done through pipeline and taxable service under (zzz) clause was brought into force w.e.f. 16.6.2005 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , taxation under any other category (clearing & forwarding service) or (business auxiliary service) prior to 16.6.2005 was held to be inconceivable. Departmental Clarification Circular No. B1/6/2005-TRU dated 27.7.2005 clarifies as under - "Transport of goods through pipeline or other conduit [see sub-clause (zzz) of section 65(105) of the Finance Act, 1994] Transportation of goods, other tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n water, through pipeline or conduit is generally employed to transport petroleum and other petroleum products, natural gas, LPG, chemicals, coal slurry and other similar products. Such transport services are liable to service tax under sub-clause (zzz) of section 65(105) of the Finance Act, 1994. Consideration for the said transportation service provided may be payable periodically or from time t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o time. The service provider is required to pay service tax as and when payment is received for the services provided or to be provided."
Person Liable
Any person (including individuals) providing transportation services by pipeline or conduit to any other person shall be liable to pay service tax and shall be treated as an assessee for service tax purposes. X X X X Extracts X X X X X X X X Extracts X X X X ..... sharing by authors, experts, professionals ..... X X X X Extracts X X X X X X X X Extracts X X X X
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