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TMI Blog2025 (3) TMI 902X X X X Extracts X X X X X X X X Extracts X X X X ..... , the learned counsel for the appellant has raised several other contentions, however, since the issue is decided on merits in favour of the appellant, it is no more relevant to record a finding on them.
Conclusion - When excise duty is paid on the transaction value, which includes transportation and insurance charges, no additional service tax is exigible on those charges as they are part of the supply of goods.
Appeal allowed. X X X X Extracts X X X X X X X X Extracts X X X X ..... 19 (20) GSTL 88 (Tri.-Mumbai)] laid down the test that in the manufacture of excisable goods where central excise duty liability has been discharged on them and there was no separate agreement between the buyer and the appellant for providing any service over and above the supply of goods. The Bench further observed that there is no involvement of a service provider and a service receiver relationship in the sale transaction made between the parties. It was also noticed that where transportation cost was incurred in context with the delivery of goods at the buyers premises then such a facility extended by the appellant cannot be considered as a taxable service leviable to service tax under the category of 'business support service'. It was, therefore, concluded that the activities of transportation was just to facilitate delivery of the duty paid excisable goods at the buyers premises and same do not conform to the definition of taxable service. This decision was followed by a later decision in Gokulanand Texturisers Pvt. Ltd. & Anr. Vs. CCE & ST, Surat-II [Final Order No.10857-10860/2024 dated 9.4.2024-CESTAT-Ahmedabad]. The facts in both the cases are identical to the facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Tri.-Del.)] (2) Allengers Medical Systems Ltd. Vs. CCE, Chandigarh [2009(14) STR 235 (Tri.-Del.)] (3) Commissioner of Central Excise & Service Tax, JSR Vs.M/s. Tata Ryerson Limited AIA Engineering Ltd. Vs. CST, Ahmedabad [2019 (19) STR 257 (Tri.-Ahmd.)] (4) Commissioner of Service Tax-V, Mumbai Vs. UFO Moviez India Ltd. [2022 (61) GSTL 4 (SC)] (5) Jivan Jyot Motors Pvt. Ltd. Vs. CCE & ST, Surat [Final Order No.11565/2023 dated 24.07.2023-CESTAT-Ahmedabad.] 8. From the records of the case, we find that the appellant discharged the excise duty liability of Rs.10,04,21,540/-, i.e. Rs.7,86,81,141/- and Rs.2, 17,40,399/- on excess freight and insurance charges, respectively, consequently, the levy of service tax is unsustainable. 9. The learned counsel for the appellant has also placed reliance on the decision in their own case of their Manesar unit, where the demand has been dropped by the Order-in-Original No.18/SA/CCE/ST/2014 dated 7.05.2014 and Order-in-Original No. DLI-SVTAX-004-COM-026-16-17 dated 29.07.2016, taking cognizance of the fact that excise duty had already been discharged on the additional freight or insurance recoveries. The learned Authorised Repr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reight and Insurance, during 2012-13. The Noticee also stated in the said letter (RUD-II) that they had paid Excise duty on that extra realization amounting to Rs. 18,09.83.288/-- 14.2 The Noticee, in their reply to the SCN, has stated they collect certain amounts from the buyers of goods for the purpose of freight and insurance and amount of Rs. 18.09.83.288/- was extra realization than the actual amount of transportation charges. The noticee has also submitted that they have discharged service tax on the actual transportation charges paid to the transporter under reverse charge in terms of Rule 2(1)(d)(v) of the Service Tax Rules, 1994 and Excise duty was paid by them on extra realization amounting to Rs. 18,09,83,288/-. 14.3 Further. The Noticee has submitted that the entire amount of freight and insurance for the year 2012-13 have formed part of the assessable value of the goods sold by them on which excise duty has been paid. The noticee has placed on record a detailed chart showing month-wise additional amounts collected towards transportation and insurance for the financial year 2012-13. which have formed part of the assessable value of the good sold and excise duty on t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ied, which order attained finality, the Department cannot be permitted to take a stand that service tax is leviable. Reliance was also placed on the decision in Commissioner of C. EX., Hyderabad versus Novapan Industries Ltd. [2007 (209)ELT 161 (S.C.)] where the Apex Court observed:- "14. In view of a catena of decisions of this Court, it is settled law that the department having accepted the principles laid down in the earlier case cannot be permitted to take a contra stand in the subsequent cases [See: Birla Corporation Ltd. v. CCE [2005 (186) E.L.T. 266 (S.C.)], Jayaswals Neco Ltd. v. CCE, Nagpur [2006 (195) E.L.T. 142 (S.C.)] etc.]" 12. We, therefore, conclude that the activity of arranging transportation of goods till the dealers premises cannot be classified under 'Business Auxiliary Service' and, therefore, no service tax is payable on transportation related expenses recovered in excess by the appellant from their buyers. It is an activity which is directly related to the supply of goods on which excise duty has been paid by the appellant and once the excise duty has been paid, no service tax is leviable on the said transaction. Although, the learned counsel for the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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