In Absence Of Consignment Note, Services Cannot Be Considered As GTA Services, Service Tax Not Sustainable: CESTAT

The Delhi Bench of Customs, Excise, and Service Tax (CESTAT) has held that in the absence of a consignment note, services cannot be considered GTA services, and the demand for service tax under the category of “goods transport agency” does not sustain.

The bench of Binu Tamta (Judicial Member) has observed that the appellant, apart from running the petrol pump outlet, is also providing the transportation of petroleum pumps on behalf of Bharat Petroleum Corporation Limited (BPCL), the service receiver, and M/s BPCL has issued a certificate mentioning that service tax has been discharged by them on a monthly basis, being the person liable to pay tax on services received under the Goods Transport Agency as per the provisions of the Finance Act. Therefore, the service tax liability has been discharged by the service receiver, and consequently, the appellant is not liable to discharge the same once again.

The appellant/assessee is running a petrol pump outlet under the dealership of BPCL, which is outside the purview of service tax. The appellant also owns a commercial vehicle that is used for the transportation of diesel and gasoline from the premises of BPCL to various filling stations.

The appellant stated that since the services provided by them are covered by Section 68(2) of Chapter V of the Finance Act, 1994, read with Notification No. 30/2012-ST dated June 20, 2012, As per the notification, the service receiver is liable to pay service tax under the reverse charge mechanism; hence, it did not take service tax registration and also did not file any service tax returns.

The appellant contended that the assessee is the owner of the truck that is used for the transportation of diesel or gasoline; they fall under the negative list and are exempt from the levy of service tax. No service tax is chargeable as one of the basic ingredients as per the provisions of the Finance Act, 1994, to constitute a “goods transport agency“ is that the service provider has to issue a consignment note, which is missing, and the Tribunal, in a catena of decisions, has held that the issuance of a consignment note is pre-requisite for taxability under GTA services.

The CESTAT held that the appellant, being the owner of the truck and providing the transportation through it, cannot be treated as GTA service and would, therefore, squarely fall under the exemption.

Counsel For Appellant: Shuchi Sethi

Counsel For Respondent: Arun Sheoran

Case Title: Mr. Sitaram Jaggnath Prasad Sihotia Versus Commissioner (Appeals), Customs, Central Excise & CGST, Jaipur

Case No.: Service Tax Appeal No. 54963 of 2023 – (SM)

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