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TMI Blog2022 (3) TMI 803X X X X Extracts X X X X X X X X Extracts X X X X ..... in the impugned order that service recipient has discharged service liability thereof. Therefore, the said allegation is not sustainable. In some of the cases the appellant transported the good by road without issuance of the consignment note, the said activity prior to June 2012 was not classifiable under category of services as no consignment note was issued and it is prime requirement to demand service tax under the category of good transport agency service. Further, the appellant has hired out vehicles to other GTA service providers, who have issued consignment notes to their clients. Such activity of the appellant was also exempt under notification no. 1/2009-ST dated 5.1.2009 for the period prior to 30.6.2012 and exempt under notification no. 21/2012-ST dated 20.6.2012 for the period post July 2012. The appellant has transferred the right to use vehicle to its client and such activity was not covered under supply of tangible goods service prior to June 2012 as the possession and control was also given to the person who had the right to use the goods and such activity amounts to deemed sales covered in negative list from July 2012. But the appellant has discharged the serv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or to June 2012 as the possession and control was given to the person who took right to use. Such activity amounts to deemed sale covered by negative list from July 2012,in such cases, the appellant discharged service tax on these activities for the period 2015-16. 4. Pursuant to the investigation carried out by the Department, the SCN was issued to the appellant by invoking extended period of limitation based on a single agreement with M/s. JMC Project (I) Ltd. (JMC) alleging that the services provided by the appellant falls under the category of Supply Of Tangible Goods For Use Services and it has fraudulently taken registration under the category of GTA services. It was also alleged that in Balance sheet, the amount is shown as received for hiring charges, which is the only system of revenue generation. Therefore, the demand service tax amounting to ₹ 20,97,73,103/- along with interest and imposition of penalty on both the appellants was proposed. During adjudication, the adjudicating authority dropped the demand of ₹ 4,96,02,479/- and interest and penalty pertains to agreement with JMC but remaining demand has been confirmed along with interest and penalties were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd other contract of Afcon and L T ltd. were supplied during the reply to the show cause notice. Further job work orders of Steel Authority of India Ltd. along with copies of invoices and consignment notes on 17.2.2017. In the agreement / work order with JMC which has also been relied upon by the Department, the main work was allotted to appellant as mentioned in the subject of said work order was Revised work order for transportation of material from Mertha Crushing Plant to Hathras and in the case of M/s. Afcon, transportation of aggregate from crusher site at Mahipalpur, Rajasthan to Camp A at Katphori and Camp B at Saifai, UP. In the case of L T the work was contracted to sub contractor for transportation of approved quantity Granular Sub Base material as per Table 400-1 (Grading -1) for Delhi Agra Road Project. 8. In the case of JMC, Afcons and L T Ltd., the adjudicating authority accepted the claim of the appellant that the main activity carried out by them was transportation of goods and these companies are body corporate and are liable to pay service tax on transportation of goods by road in a goods carriage under reverse charge mechanism. As is in these cases, the cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... contract with JMC. In this case, the amount received is dependent upon the quantity of goods actually transported and distance covered by shortest route with weighment of goods at loading and unloading site. Thus, as per the Agreement/ Contract, they have not supplied tangible goods for use to JMC but they transported goods of JMC from their one site to another, which is not covered under STGU Service but under Goods Transport Agency (GTA) service on which JMC was liable to pay Service Tax under reverse charge mechanism. Similarly, they also entered into contact dated 06.10.2015 with M/s Afcons Infrastructure Ltd.) for transportation of aggregates from Mahalpur (Raj.) Jignia. Gwalior (MP) to Firozabad/ Etawah for construction of Agra-Lucknow Expressway. Similar Agreement dated 01.10.2014 was also entered with M/s Larsen Toubro Ltd. (in short 'L T Ltd.') for transportation of material. Thus the principal activity carried out by them was transportation of goods which is much specific than supply of tangible goods for use. 11. Thereafter, the adjudicating authority held as under: 35.1.3 I find that in the case of JMC, Afcons and L T Ltd. as far as the contracts a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etween appellant and JMC India Ltd., Mumbai and after examining the said contract with M/s. JMC, the alleged demand under the category of supply of tangible goods for use has been dropped by the adjudicating authority and said finding of the adjudicating authority has not been challenged by the Department and no other contract is the basis of issuance of show cause notice, in that circumstances, the demand against the appellant is not sustainable. 13. Further, on merits also we have examined that the appellant has carried out 3 type of activities: a) Transportation of goods with or without issuance of consignment notes. b) Hiring of vehicles to other GTA service providers, who have issued consignment notes to their clients. c) Transfer of right to use goods. 14. Admittedly, wherein the goods transportation activity has been carried out and consignment note has been issued by the appellant, the appellant is not liable to pay service tax but the service recipient is liable to pay service tax under the reverse charge mechanism and it is recorded by the adjudicating authority in the impugned order that service recipient has discharged service liability thereof. Therefore ..... X X X X Extracts X X X X X X X X Extracts X X X X
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