Mud is being dugged out from earth during a construciton process. Party 'A's duty is to just load whatever mud, dugged out from the process, in a truck and dispose it off to a specified location. Is this process attracts service tax liability? If so under which service it needs to be categorised? Is there any abatements for this? Kindly help.
As per my opinion since introduction of negative list regime in service tax section 65A which govern the ruling of classification of services has lost its relevance. It was once deleted but only for statiscal and administrative purposes it was brought back. Since the services provided by your client is not covered in either negative list or mega exemption notification it is taxable . But may be exemption provided to subcontractor can become applicable (i am not fully sure due to lack of input provided by you).And since no specific abatement is given to this typr of service it will be taxable at 12.36%( subject to limit of Rs. 10 lakh)