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2018 (11) TMI 1755 - AT - Service TaxClassification of services - Cargo Handling services or not - loading and unloading of limestone gitti - composite services or not - appellant is primarily engaged in the work of transportation of products of lime stone of the stone mines owned by M/s. Rajasthan State Mines and Minerals Ltd. - HELD THAT:- The agreement dated 29th/30th April, 2005 between the Appellants and M/s. Rajasthan State Mines and Minerals Ltd. deals with hiring of Pay Loader and Tippers for loading and transporting of stone gitti from Mining Area to Railway siding at Jaisalmer including stocking of the same and ‘watch and ward’ till further loading into Railway wagons. The distance is also mentioned as 119 Kms. on average basis. Thus, it is a composite agreement both for hiring of Pay Loader and Tippers for loading and for transporting coal to a distance of 119 Kms - The terms & conditions also deals with diesel escalation/de-escalation which may be given as per rules of the company. A perusal of the agreement does indicate that the dominant nature of the work is for transportation of goods covering an average distance of 119 Kms. Hiring of pay loader and tippers for loading as ‘Watch and Ward’ services for the purpose of transporting is only incidental. In fact, the unloading was by mechanical means. The cost of transportation is ₹ 121.35 per ton and the distance is 119 km. The work of loading and unloading watch and ward of cargo is incidental to “transportation’, which has also been clarified by Circular dated 6 August, 2008 issued by Government of India, Ministry of Finance, Department of Revenue in regard to Service tax levy on goods transport by road services. Whether in the present case transportation is the main service and loading / unloading is ancillary service provided for successful completion of the main service? - HELD THAT:- The cost of transportation charge is ₹ 121.35 per ton of limestone quantity delivered at an average distance of 119 km. It is apparent that the essential feature of the service is transportation. Loading and unloading, watch and ward etc. are ancillary service provided in relation to transportation of goods, and such service would be Goods and Transport Agency Service - On the similar issue the Hon’ble Supreme Court in casse of Commissioner of Central Excise & Service Tax, vs. Singh Transporters reported in [2017 (7) TMI 494 - SUPREME COURT], Supreme Court has held that the activity, as it in the present case, is more appropriately classifiable under the category of Goods Transport Agency Service rather than in the category of the ‘Cargo Handling Services’. Thus, the activity of the appellant is correctly classifiable under “Goods Transport Agency Service”. Appeal allowed - decided in favor of appellant.
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