Custom, Excise & Service Tax Tribunal
Pranish Carriers L L P vs Ce & Cgst Ghaziabad on 9 November, 2023
CUSTOMS, EXCISE & SERVICE TAX APPELLATE TRIBUNAL
ALLAHABAD
REGIONAL BENCH - COURT NO.I
Service Tax Appeal No.70692 of 2017
(Arising out of Order-in-Original No.05/Commr./Audit-II/Ghaziabad/2017-18
dated 20/05/2017 passed by Commissioner of Central Excise & Service Tax
(Audit), Ghaziabad)
M/s Pranish Carriers LLP .....Appellant
(G-41, Sector-39, Noida-201301)
VERSUS
Commissioner of Central Excise, Gaziabad ....Respondent
(Audit-II Commissionerate, CGO Complex-II, Gaziabad)
APPEARANCE:
Shri Gopal Mundhra, Advocate for the Appellant
Shri Sandeep Pandey, Authorised Representative for the Respondent
CORAM: HON'BLE MR. P.K. CHOUDHARY, MEMBER (JUDICIAL)
HON'BLE MR. SANJIV SRIVASTAVA, MEMBER (TECHNICAL)
FINAL ORDER NO.70183/2023
DATE OF HEARING : 12 October, 2023
DATE OF Pronouncement : 09 November, 2023
SANJIV SRIVASTAVA:
This appeal is directed against Order-in-Original
No.05/Commr./Audit-II/Ghaziabad/2017-18 dated 20/05/2017
passed by Commissioner of Central Excise & Service Tax (Audit),
Ghaziabad. By the impugned order following has been held:-
ORDER
(a) I confirm the demand of Service Tax amounting to 4, 34,12,380/- (Four Crore Thirty Four Lakh Twelve Thousand Three Hundred Eighty only) (inclusive of Education Cess & S.&H. Education Cess) upon the party under proviso to Section 73(1) of the Finance Act 1994 readwith Section 73(2) of the Act, ibid.
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(b) I also confirm the demand of interest on the amount mentioned above under Section 75 of Finance Act 1994.
(c) I impose a penalty of Rs. 4,34,12,380/- (Four Crore Thirty Four Lakh Twelve Thousand Three Hundred Eighty only) upon M / s Pranish Carriers LLP, G-41, Sector-39, Noida under Section 78 of Finance Act 1994. However, as per second proviso to section 78 of the Act ibid, if the party pays the adjudged amount of Service Tax alongwith interest with in a period of 30 days of receipt of this order the penalty payable shall be 25% of the above said amount provided that the reduced amount of penalty is also paid within 30 days.
(d) I impose penalty of Rs. 10,000/- (Rupees Ten Thousand only) in terms of Section 77(1) (a) of the Finance Act, 1994 upon M/s Pranish Carriers LLP, G-41, Sector-39, Noida for not taking Service Tax registration under Section 69 of the Finance Act, 1994.
(e) The adjudged dues will be paid henceforth." 2.1 Appellant is engaged in providing the services of GTA on which the due service tax is paid by the recipient of the service i.e. M/s INOX Air Products Ltd. [INOX].
2.2 On the basis of information received that appellant is evading the service tax, the business-cum-residence premises of the appellant was searched on 11.12.2015 and various documents recovered were resumed under Panchnama dated 11.12.2015. Further, the statements of various persons namely Shri Prasant Bhayana, and Shri Sanjeev Bhayana, Partners of the appellant, were recorded. During the course of scrutiny of various agreements resumed from the premises of the appellant and the statements recorded, it was viewed that appellant had entered into an agreement with INOX units at various locations. Appellants were providing the Lorry Chassis to INOX on which specialized tanks/ equipments for carriage of gas was mounted by M/s Inox. These carriers with the mounted items were used for transportation of the gases.
Service Tax Appeal No.70692 of 2017 3 2.3 Revenue was of the view that supply of chassis by the appellant on which the specialized tanks/ equipments were mounted by M/s INOX was provision of service under the category of Supply of Tangible Goods Services (Section 65 (105) (zzzzj) of Finance Act, 1994) and the appellants were required discharge the service tax under the said category which was not being done.
2.2 After completion of investigations a show cause notice dated 22.03.2016 was issued to the appellant, asking them to show cause as to why-
i. Service Tax amounting to Rs.4,34,12,380/- (Four crore thirty four lakh twelve thousand three hundred eighty) only inclusive of Education Cess & S&H Education Cess not paid by them should not be demanded and recovered from them under proviso to section 73(1) of the Finance Act 1994.
ii. Interest on the amount mentioned in (i) above should not be charged and recovered from them under section 75 of Finance Act 1994.
iii. Penalty under section 78 of Finance Act 1994 should not be imposed upon them with reference to service tax demanded in (i) above.
iv. Penalty in terms of Section 77(1) (a) of the Finance Act, 1994 should not be imposed on them for not taking service tax registration under Section 69 ibid."
2.3 The demand has been raised for the period from October, 2010 to March-15. This show cause notice has been adjudicated as per the impugned order referred in para-1 above. Aggrieved appellant have filed this appeal.
3.1 We have heard Shri Gopal Mundhra learned Counsel for the appellant and Shri Sandeep Pandey learned Authorised Representative appearing for the revenue. 3.2 Arguing for the appellant learned Counsel submits that-
Service Tax Appeal No.70692 of 2017 4 The agreements interred into by them with M/s Inox various units contains several terms and conditions, which explain that and effective control over these chassis continue to lie in the hands of the appellant. Further, the agreement imposes the responsibility of proper maintenance.
The agreement was in respect of providing the chassis owned by the appellant to M/s Inox on hire charges which included fixed and variable charges as per travelled distance. The appellant has accepted that there was not transfer of effective control and possession of the goods i.e. chassis and in support of this the appellant has provided various documents. The essence of the contractual arrangement between the appellant and M/s Inox is rendition of services of transportation from one location to another, and not supply of the chassis as is evident from the following:-
o Transporting of gas from one place to another o Ensuring safe and timely delivery of goods at customer's location.
o Providing of sufficient number of drivers/ cleaners and payment of their wages and other claims o Making payments towards toll / naka charges, octroi expenses and any other State and Interstate duties and taxes during the course of transportation of goods.
o Maintenance and upkeep of vehicle.
o Meeting requirement of Motor Vehicle Act. o Fulfilling all the obligations in terms of statutory requirement for transportation of goods. o Protect VITT and the goods stored within it."
Appellant is responsible for completing the end to end transportation activity for M/s Inox and obligation under contract is clearly to transport the goods from one Service Tax Appeal No.70692 of 2017 5 destination to another and such obligation does not stop at merely by supplying the Lorry Chassis. The appellant was issuing the consignment notes for transportation of the goods and was transporting the goods as per those consignment notes as a commercial obligation under the contract is clearly to transport of the goods from one destination to another. The fact that appellant issued consignment notes is admitted and accepted in the impugned order.
All the above fact clearly show that the appellant was providing Goods Transport Services and his services are covered under that category only. Reliance is placed by the following decisions:-
o Nandganj Sihori Sugar Co. Ltd. vs. CCE, Lucknow [2014 (34) STR 850 (Tri. - Del.)] o CCE & ST vs. JWC Logistics Pvt. Ltd. [2019 (22) GSTL 237 (Tri.-Mumbai)] o Birla Ready Mix vs. COCE, Noida [2013 (30) STR 99 (Tri. - Del.)] o South Eastern Coalfields Ltd. vs. CCE., Raipur [2017 (47) STR 93 (Tri.- Del.)] o South Eastern Coalfields Ltd. vs. CCE., Raipur [2018 (10) GSTL 50 (Tri. - Del.)] o Western Coalfields Ltd. vs. CCE, Nagpur (2017 (4) GSTL 260 (Tri. -Del)]) o Saswad Mali Sugar Factory Ltd. vs. CCE, Pune [2016 (12) TMI 438 -CESTAT Mumbai] o Nagpal Traders vs. CCE, Meerut - II [2019 (7) TMI 260 - CESTAT New Delhi] M/s Inox had been paying the service tax on these services under reverse charge mechanism as provided in law. Accordingly, once the service tax has been paid there cannot be demand for payment of service tax again. Revenue have raised no objection to the payment of service tax by M/s Inox.
Service Tax Appeal No.70692 of 2017 6 Extended period cannot be invoked in the present case as the issue is interpretational in nature and the appellant was believe that the tax was payable under GTA and the same was done effectively by M/s Inox under RCM. 3.3 Arguing for the revenue learned Authorised Representative reiterates the findings recorded in the impugned order and the Order-in-Original.
4.1 We have considered the impugned orders along with the submissions made in appeal and during the course of argument.
4.2 For holding against the appellant Adjudicating Authority in his order observed as follows:-
26. I find that the Show Cause Notice alleges that the activity carried out by the party is covered under the service "Supply of Tanaible Goods for Use" upto 30.06.2012 as defined under Section 65(105)(zzzzj) of the Finance Act, 1994 and under Declared Service as defined in Section 66(E)(f) w.e.f. 01.07.2012 whereas the party has submitted that the activity carried out by them is covered under category of "Goods Transport Agency"
(GTA). The GTA is defined as under Section 65 (50b) as below:-
"Goods Transport Agency means 'any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called'.
27. I intend to analyze the allegations made upon the party through impugned show cause notice in the light of legal provisions mentioned above. It has been alleged in the SCN that services provided by the owners of the vehicles do not come within the scope of GTA on the ground that (i) the definition of GTA itself clarified that only the services of an agency providing services in relation to transportation of goods by road are covered under /within the scope of GTA and not mere transportation of goods by road (ii) the 'owner' of the goods carriage could not be said to be "Goods Transport Service Tax Appeal No.70692 of 2017 7 Agent", the taxable service of GTA under Section 65(105) (zzp) is to be provided to a customer, by a GTA, in relation to transportation of goods in a "goods carriage" and accordingly, the same person could not be "owner" of the goods carriage as well as his own agent (iii) Notfn.
No.29/2008 dated 26.06.2008 exempts the taxable service of supply of goods carriage without transferring the possession and effective control of such goods as referred to sub-clause (zzzj) of clause (105) of Section 65 provided by a person to a goods transport agency for use by the said GTA. It is stated in the SCN that the said Notfn., thus clearly bought out the distinction between the owner of the vehicle and GTA.
28 I have gone through the above mentioned allegations mentioned in the SCN, I find that the words "commercial concern which" have been replaced by the word "person who" in the definition of GTA under Section 65(50b) w.e.f. 1.5.2006 and the GTA service stand defined as under w.e.f. 1.5.2006: -
"Goods Transport Agency means 'any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called'. Further, the relevant part of the TRU D.O.F. NO. 334/4/2006-TRU dated 28th February, 2006, issued along with the Budget, 2006 is as under:-
"4. Scope of certain existing services is being extended or clarified as follows:
1) The references to commercial concern, in relation to seventeen taxable services, are being substituted with person, so as to expand the scope of the service provider in the said services. By this amendment, Service Tax is leviable on the taxable services provided by a person and not necessarily by a commercial concern;"
29. Hence, in the light of the legal definition of GTA Service provided under the Finance Act, I do not agree with the contention mentioned in the SCN that only the Service Tax Appeal No.70692 of 2017 8 services of an agency providing services in relation to transportation of goods by road are covered under /within the scope of GTA and not the transportation of goods by road by any individual owner of the vehicle. The relevant Section as mentioned above clearly mentions the word 'any person' and not 'an agency'. Though, of course, issuance of consignment note is the only condition in respect of such service of transport of goods by road by any person. In the light of foregoing, I find that it is not correct to suggest that only an agency is covered under GTA.
30. Further, the party in its written defence reply has submitted that the Commissioner has placed reliance on the decisions of Bellary Iron & Ore Pvt Ltd Vs. CCE Belgam [2010 (18) STR 406 (Tri-Bang)]; Laxminarayana Mining Co v CST, Bangalore [2009 (16) STR 691 (Tri-Bang)]; Caps and Prints (P) Ltd v CST Kolkata [2013 (30) STR 426(Tri- Kolkata), to conclude that owners of vehicles/individual truck owners providing transportation services are not liable to Service Tax. It is pertinent to note the decisions of Bellary Iron (supra) and Laxminarayana (supra), pertain to a period prior to the amendment in the definition of GTA wherein the phrase 'commercial concern' was substituted with 'any person'. Hence, reliance cannot be placed on the said decisions. Further, in the case of Caps and Prints (supra), the individual truck owners did not issue any consignment notes. Accordingly, reliance placed on the said decision is flawed. It is also submitted that the services will not qualify as GTA Services only in circumstances wherein the individual truck owners do not issue consignment notes. Once consignment notes are issued, the services provided by any person will qualify as GTA Services with no exclusion for individuals/owners. I agree with the submissions put forward by the party as also discussed hereinabove.
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31. It has also been alleged in the SCN that the owner of the "goods carriage" could not be said to be GTA as the same person could not be owner of the goods carriage as well as his own agent. The following decisions have been quoted in the SCN in this regard where it was held that individual truck owners are not liable to pay Service Tax under GTA:
i. Bellary Iron & Ores Pvt. Limited Vs.. CCE Belgam -
2010(18)STR-406 (Tri Bang) ii. Laxminarayana Mining Co. Vs.. CST, Bangalore -
2009(16)STR-691 (Tri Bang) iii. Caps and Prints (P) limited Vs..CST Kolkata -
2013(30)STR 426 (Tri- Kolkata) On the other hand, I find that in the following cases, the tribunal held the opposite and decided that individual truck owners too are covered under GTA:
i. Shree Balajee Transport Vs.. CCE Tirupati[2015 (38) S.T.R. 651 (Tri. - Bang.)] ii. S.V.R. ELECTRICALS (P) LTD. Vs. CCE, GUNTUR[2016 (43) S.T.R. 574 (Tri. -Hyd.)] iii. Coromandel Agro Products & Oils Ltd Vs. CCE Guntur [2014(33)STR660 (Tri.-Bang)]In the case of Shree Balajee Transport Vs. CCE Tirupati, mentioned above, the following has been held:
...... the only contention raised by the counsel for the appellant is that the appellant being a truck owner is not liable to pay Service Tax under the provisions of the Finance Act, 1994 and he has also placed reliance on the decisions of the Tribunal in the cases cited supra. From these decisions, it is seen that the Tribunal has made an observation that transportation undertaken by individuals owning and operating lorry and trucks is not subject to Service Tax as the same would not come under the category of 'Goods Transport Agency Service. This observation appears to have been made by the Tribunal Service Tax Appeal No.70692 of 2017 10 considering the clarification by the Finance Minister in the Budget Speech. It is a well settled position in law as clarified by the Hon ble Apex Court in Doypack Systems (Pvt.) Ltd. [1988 (36)E.L. T. 201 (S.C.)] and J.K. Spinning and Weaving Mills Ltd. [1987 (32)E.L.T. 234 (S.C.)] that when the words of the statute are plain and unambiguous, there is no need to place reliance on external aids such as parliamentary proceedings. There is no reason given as to how and why this conclusion could be reached in the light of the legal provisions for levy of Service Tax on GTA service. Under Section 65(50b), Goods Transport Agency means 'any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called'. Section 65(105(zzp) defines taxable service as 'service provided or to be provided to any person, by a goods transport agency, in relation to transport of goods by road in a goods carriage'. From these legal definitions it is clear that any person (including individuals) who provides service in relation to transport of goods by road is liable to Service Tax. There is no exclusion of individual truck owners from the purview of Service Tax levy under the law........"
32. I find that the above observation of Hon'ble Tribunal has squarely answered the pointunder discussion and accordingly, the suggestion that the 'owner' of the goods carriage could not be said to be GTA as per SCN is not tenable. I also find that the Finance Minister's budget speech quoted in the SCN relates to year 2004 whereas the changes in definition of GTA took place in 2006 and hence the same is not relevant.
33. It has also been stated in the SCN that transporter and GTA have separate status as per notification no. 29/2008 dated 26.06.2008 which exempts the taxable service of supply of goods carriage without transferring the possession and effective control of such goods as referred to sub-clause (zzzj) of clause (105) of Section 65 provided Service Tax Appeal No.70692 of 2017 11 by a person to a goods transport agency for use by the said GTA to provide any service as referred in Section 65(i05) (zzzj) to a customer in relation to transportation of goods by road in the said goods carriage from the whole of Service Tax. On the basis of such exemption of Service Tax given to owner of the vehicles who provides the vehicle to GTA, it has been concluded in the SCN that both are different and an 'owner' of the vehicle can never be 'GTA'. I have gone through the said notification. I find that when a person provides his goods carriage to a GTA, the tax on GTA is leviable on the person who is actually hiring/procuring the goods carriage for transportation of goods by road and therefore, the exemption has been granted to the individual who has provided the goods carriage to GTA. In my considered opinion, this in any way does not contradict the findings mentioned at para 30 above holding that individual truck owners when providing service of transportation of goods by road are very well covered under GTA, The only requirement for a GTA is that the person is involved in transportation of goods by road and he issues a consignment note for the same. At times, any individual truck owner may work like a GTA as already discussed in the foregoing para. I find that the proposition made in the SCN in this regard that a transporter and GTA have always separate status is not correct as per law. However, the correct nature of the service has to be ascertained on the basis of clauses of agreement between the party and Inox.
34. The Show Cause Notice alleges that the activity carried out by the party is covered under "Supply of Tangible Goods for Use" service upto 30.06.2012. I find that the said service has been defined under Section 65(105) (zzzzj) as, "Any service provided or to be provided to any person, by any other person in relation to supply of tangible goods including machinery, equipment and appliances for use, without transferring right of possession Service Tax Appeal No.70692 of 2017 12 and effective control of such machinery, equipment and appliances". For the period starting w.e.f. 01.07.2012, the SCN alleges that the same service falls under category of 'Declared Services' as defined under Section 66E(f) of the Finance Act, 1994 as, transfer of goods by way of hiring, leasing, licensing or in any Such manner without transfer of right to use such goods'. For ascertaining the exact nature of the service provided by the party, it is imperative to analyze the terms and conditions of the agreement.
35. I have carefully gone through the terms and conditions of the agreement between the party and Inox. Clause 2 of the agreement states that, "during the period of subsistence of agreement PCL (Pranish Carriers LLP) shall ply the feet (lorry chassis of transporter) exclusively for Inox and InoX would be free to utilize the fleet as it deem fit for the purpose of its business". Clause 3 makes it clear that the lorry chassis would be used for transportation of products of M/s Inox to its various customers 24 hours a day and 365/366 days a basis in lieu of consideration given to PCL. In clause 3a, it is stated that in case the vehicle is idle for more than seven days for whatsoever reason attributable to PCL, the proportional fixed charges will be deducted from the fixed charges for the entire period in excess of seven days for which the vehicle was not in use. Further conditions include increase/decrease in running cost linked with price of diesel, right of Inox to mount (install/uninstall) either new tank or old VITT on lorry chassis, fixing of standard distances for each of the location to where the product of the Inox is transported and Inox will not allow any changes in the standard distance barring unforeseen conditions and PCL has to take prior permission for the same, Inox will pay the charges for extra distance travelled only if convinced for it and if the mutually agreed standard distance reduced during the agreement period for whatever reasons, Inox will consider shorter distance route Service Tax Appeal No.70692 of 2017 13 for payment, Inox would pay toll/naka/behti charges to PCL on receipt of documentary proof. The above terms and conditions clearly reveal the manner in which INOX could use the lorry chassis provided by the party, and the considerations to be paid for such usage. But, at the same time, INOX does not get the right of possession and control over the lorry chassis.
36. In fact, I find that the agreement contains several terms and conditions, discussed hereinafter, which reveal that right of possession and effective control over these lorry chassis continue to lie in the hands of the party. I further find that the agreement imposes the responsibility of proper maintenance and upkeep of vehicles upon PCL. The party i.e. PCL has to maintain its fleet in goods roadworthy conditions so as to render smooth and uninterrupted transport service, the weight and volume of loaded goods should be within limits prescribed by RTO, PCL, Shall not pledge, hypothecate, mortgage or in any manner transfer or encumber the VITT, equipment and attendant facilities and fitting, In unlikely event of any party claiming from, through, under or against PCL and attaching the said VITT in respect of any claim which such party have or claim against PCL shall inform forthwith intimate Inox in writing of such attachment and also arrange to ensure that the attachment is forthwith removed, at its own cost, in such cases Inox shall recover all losses and damages from PCL, PCL shall not normally sell any lorry chassis which would be in the use of Inox during the agreement period and incase PCL desires to do so, PCL has to give ninety days prior written notice for the same and Inox may, at its option and without in any way being obliged to do so, allow its said VITT to be transferred at PCL's cost to a new lorry chassis, insurance of vehicle and driver etc. is responsibility of PCL, PCL has to ensure that each lorry chassis is equipped with registration books, valid pollution control certificates, road Service Tax Appeal No.70692 of 2017 14 and other tax certificates and permits and driving licences, PCL shall keep lorry chassis registered in its name with the RTO, Govt, municipal or other authority, all the VITTs and their fitting/accessories would be absolute property of Inox, PCL is solely responsible for obtaining road permits and complying with all the statutory provisions in respect of the fleet, PCL has all the responsibility of proper drivers/cleaners their salary etc., the VITT attachments and fittings mounted/attached on/to each of the vehicle/prime movers shall at all times the property of Inox, PCL shall at all times be responsible for the safety of the VITTs and shall be solely responsible for the return of VITTS attachments and fitting to Inox in good condition on expiry or sooner termination of the agreement, PCL responsible for safety of equipments and product, the crew of each lorry chassis should be instructed to reach the destination within the transit time as mutually agreed and in case the lorry being unable to reach the destination within the stipulated time, PCL will need to Communicate the same to the officials of Inox immediately and Inox will impose a penalty for mutually agreed amount if the reason for the delayed delivery for the product is not necessary, the entire fleet of PCL should have road permit to operate in the state as advised by Inox, the amount incurred for additional state permit other than the home plus three states will be reimbursed by Inox, at the time of renewal of Road permits, PCL has to consult Inox, PCL will ensure the running of vehicles round the clock basis and PCL will make the suitable advances to the drivers for and other expenses for each trip and incase of any exigency, Inox may arrange the advances which will be debited to PCL account, PCL crew shall be instructed to inform Inox immediately , should there be a leakage from the equipments, PCL will not hold/ withdraw the vehicle for any dispute between PCL and Inox.
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37. The agreements further mention that PCL will submit to Inox bills for transportation in the prescribed format for each of the vehicle by the third day of every month for the transport work undertaken during the previous month and Inox shall arrange to pay the bill within twenty days, PCL shall also submit to Inox bills for Octoroi/ toll expenses, Inox has the liberty to terminate the agreenment upon giving three months notice to PCL or vice versa, termination may also be effected by Inox by giving PCL forty eight hours notice in certain situations, Inox may provide vehicle tracking system in the vehicle and PCL will pay month ly Rs. 500/- towards the cost of providing this facility, if the lorry chassis are hypothecated as a security against any type of loan or financing then PCL shall comply with the terms and conditions of the agreement for loan/financing scrupulously and ensure that there is no influence from the financers end. The above terms of agreement has to be examined scrupulously to decide whether the service provided by the party actually falls within the category of 'Supply of Tangible goods for Use' service till 30.06.2012 and transfer of goods by way of hiring, leasing, licensing or in any such manner without transfer of right to use such goods' w.e.f. 01.07.2012 onwards. I have also gone through the submissions of the party in this regard. I find that the agreement was in respect of providing the lorry chassis owned by the party to M/s Inox on hire charges which included fixed and variable charges as per travelled distance. I find that the party itself has accepted that there was no transfer of effective control and possession of the goods i.e. lorry chassis. In support of their claim they have cited various arguments and submitted documents such as Insurance Policies of the vehicles used for transportation of goods taken by them, Road permits/certificates taken by the party, Document relating to subscription obtained by them of Employees Provident Fund Organization ('EPFO'), Letter Service Tax Appeal No.70692 of 2017 16 issued from Employee State Insurance Corporation ('ESIC) asking them to obtain the requisite registration under the Employee State Insurance Act (ESI Act), Transit Declaration Form TDF-1, Receipt of the fine paid by the driver of the vehicle to the RTO, Suspension order of the vehicle by Traffic Officer, Pune etc. Moreover, the agreement also provide that the party will be responsible for proper upkeep, maintenance and repair of the goods on their own expenses, they will be responsible for all permits/licences to be taken from govt. authorities, the driver and other crew members will be provided by the party, the responsibility for safety of VITT and goods under movement etc. These abovementioned terms and conditions of the Agreement coupled with the submission/acceptance of the party themselves that effective control and possession of the goods remain with them leads to Conclusion that indeed there was no transfer of right of poSsession and effective control of the goods i.e. lorry chassis in favour of M/s Inox.
39. Here I find that the clarification issued by the CBEC regarding criteria for any activity to be considered as "Supply of Tangible Goods for Use" before 01.07.2012 or 'transfer of goods by way of hiring, leasin9, licensing or in any such manner without transfer of right to use such goods' after 01.07.2012, is very relevant. The scope of the levy was clarified by the Central Board of Excise & Customs vide letter F. No.334/1/2008-TRU dated 29-02- 2008. Para 4.4 of the said letter clarifies as follows:
"4.4. Supply of Tangible Goods for use:
4.4.1.Transfer of the right to use any goods is leviable to sales tax /VAT as deemed sale of goods [Article 366 (29A)(d) of the Constitution of India]. Transfer of right to use involves transfer of both possession and control of the goods to the user of the goods.
4.4.2.Excavators, wheel loaders, dump trucks, crawler carriers, compaction equipment, cranes, etc., Service Tax Appeal No.70692 of 2017 17 offshore construction vessels and barges, ge0- technical vessels, tug and barge flotillas, rigs and high value machineries are supplied for use, with no legal right of possession and effective control. Transaction of allowing another person to Use the goods, without giving legal right of possession and effective Control, not being treated as sale of goods, is treated as service.
4.4.3. Proposal is to levy Service Tax on such services provided in relation to supply of tangible goods, including machinery, equipment and appliances, for use, with no legal right of possession or effective control. Supply of tangible goods for use and leviable to VAT / sales tax as deemed 'sale of goods, is not covered under the transfer of SCope of the proposed service. Whether a transaction involves possession and control is a question of fact and is to be decided based on the terms of the contract and other material facts. This could be ascertainable from the fact whether or not VAT is payable or paid."
It would therefore be essential to proceed with the examination of the definition of the taxable service in the light of what has been explained above. In the definition of the taxable service indicated in Section 65 (zzzzj), the key ideas are identified as under: -
++ There must be a supply.
++ Such supply must be of tangible goods. 'Tangible Goods' are that which can be touched as contrasted with intangible (or invisible) assets, such as company's goodwill or the expertise of its staff.
++ However, it should not result in passage/reassignment of right of possession and of effective control over the said tangible goods to the lessee/ user at the expense of the lessor/ owner/ provider of tangible goods.
Service Tax Appeal No.70692 of 2017 18 The above clarification also makes it clear that, transaction of allowing another person to use the goods, without giving legal right of possession and effective control, not being treated as sale of goods, is treated as service.
Further, it is also clarified that whether a transaction involves transfer of possession and control is a question of fact and is to be decided based on the terms of the contract and other material facts. This could be ascertainable from the fact whether or not VAT is payable or paid. I have already discussed this aspect hereinabove in terms of the agreement between the party and M/s Inox and also as per the submission/acceptance of the party that there was no transfer of possession and control of the goods by the party to M/s Inox. It is also noticed that there was no payment of VAT on the transaction involved and hence it was not a deemed sale.
40. In this regard, it would be interesting to go through Article 366(29A) of the Constitution of India as well as the decision of the Supreme Court in Bharat Sanchar Nigam Ltd and Another Vs. Union of India and Others (2006-
TIOL-15-SC-CT-LB) wherein the concept of sale, deemed sale and the powers of the states to levy sales tax on deemed sales had been discussed in detail in light of the 46th amendment to our Constitution. Article 366(29A) after the said amendment, goes thus- "tax on the sale or purchase of goods" includes -
(a) a tax on the transfer, otherwise than in pursuance of a contract, of property in any goods for cash, deferred payment or other valuable consideration;
(b) a tax on the transfer of property in goods (whether as goods or in some other form) involved in the execution of a works contract;
(c) a tax on the delivery of goods on hire-purchase or any system of payment by installments;
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(d) a tax on the transfer of the right to use any goods for any purpose (whether or not for a specified period) for cash, deferred payment or other valuable consideration;
(e) a tax on the supply of goods by any unincorporated association or body of person to a member thereof for cash, deferred payment or other valuable consideration;
(f) a tax on the supply, by way of or as part of any service or in any other manner whatsoever, of goods, being food or any other article for human consumption or any drink (whether or not intoxicating), where such supply or service, is for cash, deferred payment or other valuable consideration; and such transfer, delivery or supply of any goods shall be deemed to be a sale of those goods by the person making the transfer, delivery or supply and a purchase of those goods by the person to whom such transfer, delivery or supply is made.
The Supreme Court in the aforesaid case (BSNL Vs. UO) had reiterated that the sale element in those contracts not falling under the aforesaid six clauses would be taxed depending on the substance of the contract (i.e. applying dominant nature test). Here, the intention of the parties entering into the particular transaction of sale would be important. However, in cases where the contract falls under any of the six categories specified above under Article 366(29A) of the Constitution of India, the dominant nature test need not apply and the sale element of those contracts can be subjected to sales tax by the concerned state even if one or more of the ingredients for sale as specified by Section 4 of Sale of Goods Act 1930 are absent. Thus one would have to examine the nature of transactions that one intends to bring under this category of service as the same would also have to be seen from the sales tax/VAT angle to know the overall liability for the assessee.
Service Tax Appeal No.70692 of 2017 20 In the instant case, the party itself admitted that there was no transfer of right to use and no sales tax/ vat was paid on the transaction involved leading to the conclusion that there was indeed an element of providing service víde the referred agreement between the two viz. M/s. Pranish Carriers and M/s Inox."
4.3 In the present case one of the most important fact for determination of the liability to payment of service tax is the nature of transaction that is in dispute. Undisputedly, appellant was issuing consignment notes to cover the transportation of the goods from premises of service recipient to various points and for such transportation he was paid tax on the fixed amount and variable amount, nature of payment will not alter the nature of transaction. The transaction continues to be governed by the documents made in this regard which are the consignment notes. These consignment notes clearly established that the service provided by the appellant was the services of GTA and it has been constantly held that once consignment notes are issued then there cannot be any doubt in this regard. In the case of Commissioner of Central Excise and Service Tax, Dhanbad Vs M/s Bharat Coking Coal Ltd., M/s Eastern Coalfield Ltd. 2022 (9) TMI 435-CESTAT-Kolkata, following has been held:-
"5. We find that the issue is no longer res-integra inasmuch as the same has been decided by this Tribunal in the case of South Eastern Coalfields Limited vs. Commr, C. EX, Raipur 2017(47) S.T.R. 93 (Tri.- Del), wherein it has been held that the transportation services cannot be classified under GTA services where the consignment notes are not issued by the transporters.
Further, the issue has also been examined in detail in the case of Mahanadi Coalfields Limited Vs. Commr, C. EX & S.T., BBSR-1 2022 (57) G.S.T.L. 242 (Tri. - Kolkata). The relevant portion of the said decision is reproduced herein below:
"12. We also find that the same view has been consistently followed by the co-ordinate Benches of Service Tax Appeal No.70692 of 2017 21 the Tribunal, the decisions which have been admitted for consideration before the Hon'ble Supreme Court in Revenue Appeals. We note that though the matter is pending before the Apex Court, the aforesaid Tribunal decisions have not been stayed and therefore, we do not find any reason to take a contrary view. In so far as the decision in Singh Transporter's case (Supra) is concerned, we agree with the arguments canvassed by the Ld. CA for the appellant that the mandatory requirement of issue of consignment note, in order to constitute "Goods Transport Agency" as has been specifically defined in the Act, was not the subject matter of examination so as to decide the taxability in the hands of assessee receiving goods transportation services and therefore, the aforesaid Apex Court's decision has no application in the instant case.
13. We find it worth taking note of the observation made by the Tribunal in JWC Logistics Pvt. Ltd. (supra) as below:
"8. It is not the transportation of goods by road that is subject to tax but the services rendered by a goods transport agency in relation to the transportation of goods by road and road transport agency tasked with responsibilities that others connected with road transport are not, with consignment note being the point of difference. There is also no doubt that Rule 4B of the Service Tax Rules, 1994 lays down the contents of a consignment note."
14. In view of the above discussions and the decisions cited (supra) and taking into consideration the essential requirement of issuance of 'consignment note', in order to attract the definition of "Goods Transport Agency", we hold that the Service Tax Appeal No.70692 of 2017 22 transport contractors rendering the coal transportation services in mines cannot be said to be "Goods Transport Agency" and therefore, their services cannot be made amendable to levy of service tax in the category of "transportation of goods by road services". Hence, the impugned demand of service tax, interest and penalty cannot sustain and therefore, the same is set aside." In view of the above, we find that the findings made by the Ld. Commissioner cannot be interfered with and hence, the demand has been rightly dropped in the impugned adjudication orders."
4.4 On sample basis we take up for examination one of agreements dated 23.07.2010 made between the INOXAP and the appellant. Various conditions of the agreement which support the case for holding that these transactions are of transport of goods are reproduced bellow:-
a. The Appellant is transport contractor and is engaged in business of carriage of goods (clause B); b. In consideration Appellant will ply the fleet for transporting the products of Inox (Clause 2); c. INOXAP had the right to mopunt either new or old VITT's.
The decision to install or Uninstall any tank on any lorry chassis was with INOXAP.
d. The Appellant is responsible to make the payment of toll charges, octroi expenses and any other state and Inter- state duties/taxes during every trip of transporting the product (Clause 6);
e. The Appellant shall always maintain its Lorry Chassis in goods roadworthy conditions so that it can render smooth and uninterrupted transport services (Clause 8.I); f. The Appellant is also responsible to insure the Lorry Chassis, drivers, other cabin crew and other employees/agents engaged for transportation Clause 8. VI);
Service Tax Appeal No.70692 of 2017 23 g. The Appellant is required to ensure that each Lorry Chassis is equipped with registration book, Valid Pollution Control (PUC) certificate, road and other tax certificates and with all valid and subsisting permits from respective transport/road authorities and also valid driving license of the Lorry Chassis driver required for authorized road movement (Clause 8.VIII);
h. The Appellant shall keep the Lorry Chassis registered in its name with the concerned R.T.O., Government, Municipal or any other authority (Clause 8.VIII); i. The Appellant is required to ensure that the drivers employed are qualified and medically fit. The Appellant is responsible for payment of wages to the drivers/cleaners who will be exclusive employees of the Appellant (Clause
8.X);
j. The Appellant has to ensure that the drivers employed by it possess at least 5 years of experience in driving heavy motor vehicles of which 2 years should be of driving hazardous liquid cargo (Clause 8.XI).
k. All the appointments of drivers are to be made by Owner of the Appellant and all drivers/cleaners/other employees engaged for this work should always carry an ID card duly signed by the Owner of the Appellant (Clause 8.XIII). l. The Appellant has to ensure that the drivers/cleaners observe at all times the safety and other procedures as prescribed (Clause 8.XIV).
m. The Appellant has to ensure that the crew associated with the vehicle operates the vehicle in a safe manner associated with the product being transported (Clause
8.XVI).
n. The Appellant is also required to ensure that the Lorry Chassis and its accessories are maintained properly in good working conditions at all times. The maintenance and repair of the Lorry Chassis is the responsibility of the Appellant (Clause 8.XIX).
Service Tax Appeal No.70692 of 2017 24 o. The VITT's attachments and fittings mounted/ attached on/ to each of the vehicle/ prime mover was at all times the property of INOXAP. Appellant was responsible for its safety and was responsible and liable for return of the VITT's attachment and fittings to INOXAP in good condition, on expiry or sooner termination of the agreement (Clause XXI, XXII, XXIII).
p. Appellant was responsible to ensure the delivery of goods loaded on the lorry at destination within transit time as agreed mutually with INOXAP. In case of delay which is not explained properly penalty was impossible on the appellant (Clause 8.XXIV) q. The Appellant should ensure that the vehicles are running on round the clock basis and will suitable arrangement of advances to the drivers for diesel and other expenses for each trip (Clause 8.XXVII).
r. The Appellant is required to submit to INOX the bills for transportation in prescribed format (Clause 10). s. The Appellant is responsible for all statutory requirements like provident fund, ESIC etc for the drivers and cleaners engaged by them for running the Lorry Chassis (Clause
18).
t. Agreement is subject too the provisions of Carriers Act, (Clause 23) 4.5 Relevant Provisions of the Carrier Act, 2007 are reproduced below:
"Section 2 Definitions:
In this Act, unless the context otherwise requires,--
(a) "common carrier" means a person engaged in the business of collecting, storing, forwarding or distributing goods to be carried by goods carriages under a goods receipt or transporting for hire of goods from place to place by motorised transport on road, for all persons undiscriminatingly and includes a goods booking company, contractor, agent, broker and courier agency engaged in the door-to-door transportation of Service Tax Appeal No.70692 of 2017 25 documents, goods or articles utilising the services of a person, either directly or indirectly, to carry or accompany such documents, goods or articles, but does not include the Government;
(b) "consignee" means the person named as consignee in the goods forwarding note;
(c) "consignment" means documents, goods or articles entrusted by the consignor to the common carrier for carriage, the description or details of which are given in the goods forwarding note;
(d) "consignor" means a person, named as consignor in the goods forwarding note, by whom or on whose behalf the documents, goods or articles covered by such forwarding note are entrusted to the common carrier for carriage thereof;
(e) "goods" includes--
(i) containers, pallets or similar articles of transport used to consolidate goods; and
(ii) animals or livestock;
(f) "goods forwarding note' means the document executed under section 8;
(g) "goods receipt" means the receipt issued under section 9;
Section 9 Goods receipt (1) A common carrier shall,--
(a) in case where the goods are to be loaded by the consignor, on the completion of such loading; or
(b) in any other case, on the acceptance of the goods by him, issue a goods receipt in such form and manner as may be prescribed.
(2) The goods receipt shall be issued in triplicate and the original shall be given to the consignor. (3) The goods receipt shall be prima facie evidence of the weight or measure and other particulars of the goods and the number of packages stated therein.
Service Tax Appeal No.70692 of 2017 26 (4) The goods receipt shall include an undertaking by the common carrier about the liability under section 10 or section 11.
Section 10 Liability of common carrier.
(1) The liability of the common carrier for loss of, or damage to any consignment, shall be limited to such amount as may be prescribed having regard to the value, freight and nature of goods, documents or articles of the consignment, unless the consignor or any person duly authorized in that behalf have expressly undertaken to pay higher risk rate fixed by the common carrier under section 11.
(2) The liability of the common carrier in case of any delay up to such period as may be mutually agreed upon by and between the consignor and the common carrier and specifically provided in the goods forwarding note including the consequential loss or damage to such consignment shall be limited to the amount of freight charges where such loss, damage or delay took place while the consignment was under
the charge of such carrier:
Provided that beyond the period so agreed upon in the goods forwarding note, compensation shall be payable in accordance with sub-section (1) or section 11:
Provided further that the common carrier shall not be liable if such carrier proves that such loss of, or damage to, the consignment or delay in delivery thereof, had not taken place due to his fault or neglect or that of his servants or agents thereof.
From the above referred clauses of the agreement dated 23.07.2010, and the provisions of the Carrier Act, and the fact that the appellant was issuing the consignment notes for the transportation of these gases cleared by the INOXAP, we are firmly of the view that the agreement/ transaction between the appellant and his client was of the good transport by road, and the services so provided will be classified under the category of Good Transport Agency Service (Section 65 (105)(zzp) read with Section 65 (50b) of Finance Act, 1994 (pre amendments made Service Tax Appeal No.70692 of 2017 27 by the Finance Act, 2012 and Section 65B (26) post amendments made in 2012).
4.6 Further, in the case of Shripad Concrete Pvt. Ltd. Vs Commissioner of Central Excise & ST, Surat-I 2023 (8) TMI 707-
CESTAT Ahmedabad, the issue has been examined both for pre- negative list period and post-negative list period and following has been held:-
"12. In order to appreciate the submissions it would be appropriate to refer to the work orders. The first order is dated 1 April, 2008 and is for a period of three years. The second work order is dated 1 April, 2011 and is valid for the period commencing 1 April, 2011 upto 30 September, 2012. The third work order is dated 1 March, 2013 and is valid up to 31 May, 2013. The relevant terms of the first work order dated 1 April, 2008 are reproduced below :-
"1. You shall load material (Ready Mix Concrete) in your Vehicles, transport the same to the required destinations unload the material at customer sites, return and take another load on similar basis in a clean vehicle in accordance with prudent industrial practices.
2. For this purpose you will deploy fleet of 6 M3 Capacity of vehicles mounted on suitable chassis in numbers adequate to transport 9000 M3 of Ready Mix Concrete every month.
3. The services shall commence within 15 days from the date of acceptance of this work order.
11. Transportation Charges: The transportation charges payable to you shall be as below :
(a) Rs. 140/- per cum for quantity of Ready Mix Concrete transported during a calendar month; and
(b) Rs. 20.34 per km for distance travelled during the month in the transportation of our Ready Mix Concrete.
Service Tax Appeal No.70692 of 2017 28
12. Minimum quantity : we assure to provide a minimum load of 745 cum per month per vehicle. In case the actual transportation is less than 745 cum we shall pay for minimum quantity of 745 cum.
15. Escalation :
The rates per km at Rs. 20.34 mentioned in clause 11(b) are on the basis of diesel prices of Rs. 34.13 per litre. In case of any variation in rates of diesel the transportation charges payable shall be increased by Rs. 0.58 per km for each Re. 1.00 of increase in diesel rates.
22. You will carry out all operation and maintenance activities at your cost. You will maintain all vehicles used for providing the services under this agreement in good working condition with periodical servicing and repair.
26. Unloading Time :
The Ready Mix Concrete is a product which has a low setting time and in case if material is not unloaded within 4 hours of loading time, then vehicle driver should inform the Company Representative and follow his instructions regarding diversion/unloading of the material, so that setting of the material is avoided. In case of setting of the material is bowl unit for the above reasons, the cost of removing the material will be borne by the company. But in case delay is on account of transit time due to fault of driver then cost of removing the material from bowl will the borne by you.
32. Your drivers and cleaners/helpers shall take all precautions to ensure that the material loaded in the Bowl is delivered at the customers' sites in good condition. In case of any loss due to improper conduct by your people the loss shall be recovered from your bills at the rate of Rs. 3000.00 per cum.
36. Receipts of Goods :
Service Tax Appeal No.70692 of 2017 29 You will issue consignment notes for all loads and obtain proper receipts from the customers after the goods are delivered. You shall provide us the copies of consignment notes and of customer acknowledgements and also submit reports to us in the formats supplied by us at the required intervals."
(emphasis supplied)
13. The basic terms remain the same for the second and third work orders, except for a change in the transportation charges and the medium quantity.
14. Having reproduced the essential terms of the work orders, it will now be appropriate to refer to the relevant provisions in regard to the pre-negative and the post-negative list.
Pre-Negative List
15. Section 65(50b) of the Act defines a 'goods transport agency' as follows :-
"65(50b) 'goods transport agency' means any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called;"
16. The corresponding taxable service under Section 65(105)(zzp) is as follows :-
'taxable service' means any service provided or to be provided- to any person, by a goods transport agency, in relation to transport of goods by road in a goods carriage;"
17. On the other hand, the taxable entry for supply of taxable goods is contained in Section 65(105)(zzzzj) and is as follows :-
"65(105)(zzzzj) to any person, by any other person in relation to supply of tangible goods including machinery, equipment and appliances for use, without transferring right of possession and effective control of such machinery, equipment and appliances;"
Service Tax Appeal No.70692 of 2017 30 Post-Negative List
18. Section 66B provides that there shall be levied a tax to be referred to as service tax on the value of all services, other than those services specified in the negative list, provided or agreed to be provided in the taxable territory by one person to another and collected in such a manner as may be prescribed. The 'negative list' is provided for in Section 66D of the Act. Section 65B(44) of the Act as inserted w.e.f. 1 July, 2012 defines 'service' to mean any activity carried out by any person for another for consideration and includes a declared service but would not include certain services specified in clauses (a), (b) and (c). Declared services have been enumerated in Section 66E of the Act. Sub-clause (f) of Section 66E, which is relevant for the purposes of the controversy involved in this appeal, is as follows :-
"(f) transfer of goods by way of hiring, leasing, licensing or in any such manner without transfer of right to use such goods;"
19. The appellant claims to be transporting RMC in vehicles under the contract awarded by the customers, particularly Grasim Industries Ltd. and Ultratech Cement Ltd. This transportation of RMC takes place in transit mixers from the premises of the customers on the basis of work orders issued. A perusal of the work order dated 1 April, 2008 issued to the appellant by Grasim Industries Ltd. indicates that the appellant was required to load RMC in the vehicles of the appellant and transport the same to the required destinations where it was required to be unloaded. The transportation charges payable to the appellant were in two parts. The appellant was to receive Rs. 140/- per cum for the quantity of RMC transported during the month. Under the second Service Tax Appeal No.70692 of 2017 31 part, the appellant was to receive Rs. 20.34 per km for distance travelled in the transportation of RMC.
20. It is clear that under the work order, the appellant was required to load RMC in the vehicles belonging to the appellant and thereafter transport the RMC to the required destination and unload it. The work order does not speak of hiring the vehicles of the appellant. In fact the appellant was required to keep all its vehicles used for providing the service under the agreement in good working condition with periodical service and repair. The Commissioner has, however concluded from a perusal of the work order that the recipient of service i.e. M/s. Grasim Industries Ltd. and M/s. Ultratech Cement Ltd. needed a large number of vehicles for transportation of RMC from their plant to the premises of the customer and they have entered into an agreement for deployment of 6M3 capacity vehicles which can be used by the recipient and serve as per their requirement. The Commissioner, therefore, observed that the appellant had given on hire vehicles to the service recipient for use in the transportation of RMC from its plant to the premises of the customer though the right to possession and effective control over the vehicles remained with the appellant and it had to deploy manpower to operate and control the vehicles.
21. This conclusion drawn by the Commissioner is a patently wrong understanding of the conditions of the work order. The appellant did not give on hire the vehicles. Even the subject matter of the "work order is for transportation of Ready Mix Concrete in vehicle/vehicles from our Jaipur 1TD Ready Mix Plant at Jaipur". The contract that has been awarded is also for transportation of Ready Mix Concrete from the plant of the appellant on the terms and Service Tax Appeal No.70692 of 2017 32 conditions mentioned in the work order. Condition No. 1 of the work order is that the appellant shall load RMC in the vehicle and transport the same to the required destination and unload it at the customer's site. Merely because the work order requires the appellant to deploy a fleet of 6M3 capacity vehicles for transport of 9000 M3 of RMC every month does not mean that the appellant has given vehicles on hire. The work order only requires the appellant to ensure that it has available a fleet of vehicles adequate enough to transport a particular quantity of RMC every month. Even the transportation charges are under two heads. The first is payment of a certain amount for the quantity of RMC transported during a calendar month and a certain amount per km for the distance travelled for transportation of RMC during the month.
22. It is for this reason that the appellant had contended that the activity of transportation of RMC by road falls under the taxable service GTA. However, this contention of the appellant has not been accepted by the Commissioner for the reason that clause 12 of the work order deals with a minimum quantity of RMC to be transported per month per vehicle. According to the Commissioner, it cannot be said to be a case of transportation of goods by road by a goods transport agency "because in the case of transport of goods by road the service recipient books a vehicle for transportation of goods and pays freight for such booking for the transportation of goods". The Commissioner failed to appreciate that under the work order, the appellant was required to transport RMC for which purpose the appellant was required to load RMC in the vehicles of the appellant and transport the same to the required destination and unload it. The requirement under the Service Tax Appeal No.70692 of 2017 33 work order that the appellant should have a fleet of vehicles, adequate enough to transport 9000 M3 RMC every month would not mean that the appellant had given the vehicle on hire. The Commissioner was required to examine all the conditions of the work order but the finding is based on an assumption that vehicle was hired for transportation of RMC.
23. The Commissioner also fell into an error in assuming that if a minimum load of 745 cum per month per vehicle is not loaded, then too the appellant would be entitled to payment on this minimum quantity to conclude that in this manner payment would also be made for goods that have not been transported and no consignment note would have been issued for the same.
24. Under Rule 4B of the Service Tax Rules, 1994 a consignment note is a document issued by a GTA reflecting the name of the cosigner and consignee, registration number of the goods carried in which the goods are transported, details of the goods transported, details of the place of origin and the destination and the person liable for paying the service tax. The consignment notes issued to by the appellant which are contained from the pages 112 to 130 of the appeal paper book contain all the particulars as mentioned in Rule 4B and the issuance of the consignment note has not been disputed in the show cause notice.
25. It would be seen from that pre-negative list period prior to 1 July, 2012 that the following two conditions have to be satisfied for a service to fall within the purview of GTA service :-
(i) There should be transportation of goods by road; and Service Tax Appeal No.70692 of 2017 34
(ii) Issuance of consignment note by GTA for the post-negative list period from 1 July, 2012 to 31 March, 2013.
26. The following conditions have to be satisfied pre- negative list for a service to qualify as a GTA service :
(i) There should be an activity in relation to transport of goods by road;
(ii) Issuance of consignment note by the GTA;
(iii) Activity is performed by a GTA for another; and
(iv) Activity is performed for consideration.
27. It cannot be doubted that the first condition with regard to both pre-negative list and the post- negative list is satisfied since RMC has been transported by the appellant using transit mixers of the appellant by road. The second condition relating to issuance of consignment note by GTA in the pre- negative list period and the post-negative list period is also satisfied as the appellant had issued the consignment notes. The third condition in the post- negative list period is that the activity should be performed by the GTA for another. It cannot be doubted that the appellant has undertaken the transportation of RMC for the mine owners. The fourth condition of the post-negative period is that the activity should performed for a consideration. It cannot also be doubted that the appellant is receiving consideration from the service recipient as is clear from the invoices raised by the appellant to the service recipient.
28. Thus, the appellant has been rendering GTA service by transporting RMC from one place to another as per the directions of the service recipient. The finding to the contrary recorded in the impugned order by the Commissioner that the appellant was Service Tax Appeal No.70692 of 2017 35 not performing GTA service but was performing STG service cannot be sustained.
29. It is, therefore, not necessary to examine the other contentions raised by the Learned Counsel for the appellant. The impugned order dated 15 January, 2016 is accordingly, set aside and the appeal is allowed."
6. From the above decision of the principal Bench of this Tribunal, it can be seen that the facts such as transportation of RMC by similar vehicles for M/s. Ultratech Cement Limited for transportation from M/s. Ultratech Cement Limited plant to the customer‟s site of M/s. Ultratech Cement Limited, it was held that appellant in that case are rendering GTA service by transportation RMC from one place to another as per the direction of the service recipient. Therefore, the same is not classifiable under supply of Tangible Goods for Use service.
7. Considering the above decision which is directly on the issue coupled with the facts clearly coming out from the contract, we are of the view that the appellant's service is correctly classifiable under Goods Transport Agency service for which service recipient M/s. Ultratech Cement Limited have discharged the service tax as required under Rule 2(d) of Service Tax Rules, 1994 under reverse charge basis. Therefore, the demand under the category of Supply of Tangible Goods service shall not sustain. Accordingly, the impugned orders are set-aside and the appeals are allowed."
4.7 Similar view has been expressed by this Bench in the case of M/s Narendra Road Lines Pvt. Ltd. 2022 (64) GSTL 354 (Tri.- All.) 4.8 As all the evidences available on record and the decisions as above clearly show that the transactions were of GTA, service tax has rightly paid by the recipient of service i.e. M/s Inox. 4.9 Admittedly, in the present case entire tax due has been paid in respect of these transactions between the appellant and Service Tax Appeal No.70692 of 2017 36 his client. That being, we are of the view that the same transaction could not be levied to service tax both at the hands of the service recipient and the service provider under different category of services. In this case, if these transactions were to be taxed under the category of SOTG, as has been held by the impugned order entire amount paid by the service recipient under the category of GTA services on the reverse charge basis should have been refunded. There is no scope of double transaction under the statute. The demand made in the present case after noting the payment of tax as the hand of service recipient the same transaction goes contrary to the Article 265 of the Constitution and hence cannot be sustained. 4.10 As we are unable to sustain the demand of service tax on the merits, issues of extended period of limitation, demand of interest and penalties imposed are irrelevant and are not being taken up.
5.1 Appeal is allowed with consequential relief, as per law.
(Pronounced in open court on-09/11/2023) Sd/-
(P.K. CHOUDHARY) MEMBER (JUDICIAL) Sd/-
(SANJIV SRIVASTAVA) MEMBER (TECHNICAL) akp