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TMI Blog2023 (9) TMI 1282X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Appellant from M/s SSTAPL and M/s JSL has to be analysed separately to determine the nature of the service rendered by the Appellant during these periods. After successful completion of the job and necessary certification by M/s. JSL, the Appellant raised invoices on M/s. SSTAPL for Transportation and Unloading of Coal from Sukinda Railway Siding to JSL, KNIC . The Appellant did not issue any 'Consignment Note' in the name of the consignee M/s. JSL. After loading of the goods into the Rakes, 'Consignment notes' were issued by M/s SSATPL to M/s. JSL, the consignee. Service tax as applicable was duly discharged under reverse charge by M/s. JSL on the GTA Service. It is evident from the clauses in each of the Work order issued to the Appellant by SSTAPL that the services fall under the category of Goods transportation and not Cargo handling service. However, since the consignment note in the present case has been issued by SSTAPL on JSL and not the Appellant, the said service qualifies as services of transportation falling under the negative list entry Section 66D(p) services by way of transportation of goods (i) by road except the services of (A) a goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Central Excise and GST Commissionerate, Bhubaneshwar, initiated an investigation against the Appellant, M/s Laxmi Narayan Transport, on the allegation that they have failed to discharge Service tax on the services provided to M/s. Sanjay Sahani Transport Agency (P.) Ltd. (SSTAPL) and M/s. Jindal Stainless Limited (JSL). 3. The transactions undertaken by the Appellant during the period under dispute can be divided into two categories: Period April 2012 to December 2014 3.1. During the period April 2012 to December 2014, M/s. SSTAPL was engaged by M/s. JSL for providing transportation services to M/s. JSL. M/s. SSTAPL, on whom work order was placed by M/s. JSL, outsourced the said service from the Appellant, by placing separate work orders stipulating the terms and conditions there in. The Work orders placed by M/s. SSTAPL to the Appellant was meant for Rake handling at Sukinda Railway station Transportation of the same material from Sukinda railway siding to Jindal Stainless Limited at KNIC, Duburi, Orissa. 3.2. After successful completion of the job and necessary certification by M/s. JSL, the Appellant raised invoices on M/s. SSTAPL for Transportation and U ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the principal service and all other elements of the contracts are incidental and ancillary to the principal service. Applying the test of essentiality as set out under Section 66F(3)(a) of the Finance Act, 1994 ( the Act ) the naturally bundled composite contract would be essentially for goods transportation service and not for Cargo handling service. 6. In support of their claim. the Appellant relied on the Board Circular No. 104/07/2008-S.T. dated 6-8-2008, wherein it has been clarified as under: 3. Issue: GTA provides service to a person in relation to transportation of goods by road in a goods carriage. The service provided is a single composite service which may include various intermediary and ancillary services such as loading/unloading, packing/unpacking, transshipment, temporary warehousing. For the service provided, GTA issues a consignment note and the invoice issued by the GTA for providing the said service includes the value of intermediary and ancillary services. In such a case, whether the intermediary or ancillary activities is to be treated as part of GTA service and the abatement should be extended to the charges for such intermediary or ancillary servi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uch contract cannot be vivisected. It will be treated as a contract for transportation only as the other services are naturally bundled together with the principal service of transportation. 8. The Appellant also relied on the following rulings in support of their contention: DRS Logistics Pvt. Ltd. v. Commissioner 2017 (7) GSTL 352 (Tri.-Del) as affirmed by the Hon ble Supreme Court in 2018 (18) GSTL J172 (SC) Maa Kalika Transport Private Limited v. Commissioner 2023 (8) Centax 273 (Tri.- Cal) Commissioner v. Arvind Singh Lal Singh 2017 (48) STR 63 (Tri.-Del) Gulshan Verma v. Commissioner 2017 (5) GSTL 47 (Tri.-Chan) Khandelwal Transport v. Commissioner 2019 (22) GSTL 102 (Tri.-Mum) CCE Ranchi v. HEC Ltd. 2018 (9) GSTL 403 (Tri.-Kolkata) 9. Accordingly, by relying on the Board Circulars and the decisions cited above, they submitted that the Work Orders issued to the Appellant are essentially meant for transportation of goods and other activities are naturally bundled along with this principal service. Once the services rendered are classified as GTA Service, the liability of payment of service tax on these services was not on the Appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the Work orders are essentially meant for transportation of goods therefore, no Service tax is payable by them under the head 'cargo handling service'. 13. Service tax on the transaction has already been discharged by the recipient, i.e., JSL. Therefore, any subsequent liability at the end of the Appellant is grossly unjust and the impugned order is liable to be set aside for this reason as well. Thus, once the departmental authorities have accepted the payment made and raised no dispute thereon, subsequent liability on the said value of services at the end of the Appellant tantamounts to double tax, which is grossly untenable. Reliance in this regard is placed on Shokat Ali v. Commissioner 2019 (28) GSTL 63 (Tri.-Del).The impugned order is liable to be set aside for this reason as well. 14. The Appellant also stated that the demand computed on the basis of Form 26AS is grossly untenable in as much as it considers receipts and is not based on the value of services provided, which is taxable under Service tax. The impugned order is liable to be set aside on this ground as well. 15. The Appellant further stated that extended period of limitation is not invocable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by M/s.SSTAPL with the Appellant entails the following: Liasioning with railway authorities / SSTAPL representative to get prior intimation about arrival of material rake for JSL, Collection of RR weighment list, Supervision of volumetric assessment, offloading of material from wagon, cleaning of wagon removing the material from railway track, heaping the same by P.Loader at railway siding and release of wagons without any wharfage or demurrage and loading of trucks at siding. Transportation of material to the pre-designated area of JSL plant at KNIC, Duburi after weighment at JSL Weigh bridge and unloading at such specified area in proper stacks/heaps/bins as directed by JSL. Covering the loaded trucks with Tarpaulin, proper tyeing at all corners so as to avoid any en-route pollution and spillage, compliance for obtaining and submission of road permit, undertaking required liasioning with local public enroute to ensure smooth movement of cargo, maintain proper record of trucks loaded and unloaded at JSL site. The contract value is on per metric tonne basis. Service tax thereon is liable to be paid by JSL. The bills were to be submitted rake wise on fortnightly b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Appellant under 'Cargo handling service' during the period April 2012 to December 2014 is not sustainable. 23. During the period January 2015 to March 2017, the Appellant started providing the services directly to M/s. JSL w.e.f. January, 2015. The Appellant issued 'Consignment notes' to M/s. JSL and invoices were raised directly to M/s.JSL. Service tax under reverse charge was duly discharged by M/s. JSL on the GTA service. 24. We observe that the Work order No. JSL/OPN/TRTP/LNT/DEC/1/2014-15 dated 02.12.2014, issued by M/s JSL to the Appellant stipulates the scope of work as handling with transportation of inward and outward rake cargo from Sukinda and Jakhapura railway sidings to JSL plant and vice versa. The said scope encapsulates as follows: Proper coordination with railway authorities/JSL Executives to get prior intimation about inward and outward rakes for JSL, receive rake placement memo and submit the same for loading/unloading/cargo shifting, collection of RR, rake/wagon unloading/loading work, remove material from railway track. Depute sufficient number of vehicles and transport the inward / outward rate cargo from JSL railway siding to JSL p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unt. The guiding principle is to identify the essential features of the transaction. The interpretation of specified descriptions of services in such cases shall be based on the principle of interpretation enumerated in section 66 F of the Finance Act, 1994. Thus, if ancillary services are provided in the course of transportation of goods by road and the charges for such services are included in the invoice issued by the GTA, and not by any other person, such services would form part of GTA service and, therefore, the abatement of 70%, presently applicable to GTA service, would be available on it. 27. We observe that the clarifications cited above clearly establishes that when a composite contract is entered into between parties for transportation service including various intermediate or ancillary services provided in relation to the principal service of road transport of goods such as loading/unloading, packing/unpacking, transhipment etc., which are provided in the course of transportation, such contract cannot be vivisected. It will be treated as a contract for transportation only as the other services are naturally bundled together with the principal service of transport ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e category of 'Cargo handling service' and service tax on the said GTA service has been rightly paid by the recipient M/s. JSL. Hence, the demand confirmed against the Appellant for this period is not sustainable. 32. The Appellant has raised the issue of limitation also. The Appellant submitted that audit was duly conducted by the authorities for the FY 2012-13 to 2013-14 and the issue in dispute was not raised. Thereafter, the CPU authorities undertook investigation took a different view by classifying the impugned services under cargo handling service. We observe that it is a settled position of law that the authorities subsequently cannot adopt a different view once a view has already been accepted during the audit proceedings. Thus, we hold that there is no suppression of fact involved in this case and hence the demand confirmed by invoking extended period of limitation is not sustainable. Accordingly, we hold that the demand confirmed in the impugned order is liable to be set aside on the ground of limitation also. 33. In view of the above discussion, we hold that the service rendered by the Appellant to M/s SSTAPL as a sub-contractor as well as M/s JSL direc ..... X X X X Extracts X X X X X X X X Extracts X X X X
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