Service tax on gta

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CA GUPTA (Querist)
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08 August 2012 an individual paying freight on transportation of goods, is he liable to pay service tax or gta has to pay? all tax audit assesses (individual) are liable to pay service tax on transportation of goods or not?

CA Suresh Jain

CA Suresh Jain (Expert)
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09 August 2012 The Notification Number 30/2012-ST has been issued which specifies the service on which reverse charge is applicable.

The applicable service tax is payable in full by the recipient of the service where service is provided or agreed to be provided by a goods transport agency in respect of transportation of goods by road, where the person liable to pay freight is,—
(a) any factory registered under or governed by the Factories Act, 1948 (63 of 1948);
(b) any society registered under the Societies Registration Act, 1860 (21 of 1860) or under any other law for the time being in force in any part of India;
(c) any co-operative society established by or under any law;
(d) any dealer of excisable goods, who is registered under the Central Excise Act, 1944 (1 of 1944) or the rules made thereunder;
(e) any body corporate established, by or under any law; or
(f) any partnership firm whether registered or not under any law including association of persons;

It is there for clear that where the individual is not a proprietary concern falling under clause (a) or (d) above is not liable to pay service tax and hence the GTA has to pay the tax.

It may further be noted that liability of service tax on goods transport is only in the case where it is by a GTA or courier

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RENGARAJ R.K

RENGARAJ R.K (Expert)
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09 August 2012 In my opinion, all the (a) to (f) categories ,as explained by the expert, alone are liable to pay service tax after availing abatement of 75% on the freight amount. GTA has no liability at all unless the entity is company registered under the companies act. If GTA is an individual he has no liability even if the service receiver is individual.

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CA GUPTA

CA GUPTA (Querist)
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09 August 2012 The individuals who were already paying service tax on the GR received(transportation of goods by road) , now as per the new amendment they are not liable to pay service tax , but still they are receiving GR on which transporters have not paid service tax , what should individuals do now ? what procedure should they follow after 01.07.2012?

Asha Kanta Sharma

Asha Kanta Sharma (Expert)
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24 July 2025 Great question! Here’s a clear explanation on **Service Tax liability on freight by individuals** after the 2012 amendment and Notification 30/2012-ST:

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### 1. Who pays Service Tax on transportation of goods by road?

* **Before 1 July 2012**: The transporter (GTA) was liable to pay service tax on freight charges.
* **From 1 July 2012 onward**:

* **Reverse Charge Mechanism (RCM)** applies.
* **Service Receiver** pays the service tax if they fall under specified categories.

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### 2. Categories of service receivers liable to pay Service Tax under RCM (Notification 30/2012-ST):

Service receiver must pay service tax on freight received **if they belong to any of these**:

* (a) Factories registered under Factories Act, 1948
* (b) Societies registered under Societies Registration Act or similar laws
* (c) Co-operative societies established under law
* (d) Dealers of excisable goods registered under Central Excise Act
* (e) Body corporates (companies)
* (f) Partnership firms, including association of persons (AOP)

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### 3. What about **Individuals**?

* Individuals **not operating as proprietary concerns** or falling under above categories (like factory, firm, company, etc.) **are NOT liable** to pay service tax on freight received under RCM.
* Therefore, **if an individual (non-proprietor) receives a freight service, then the Goods Transport Agency (GTA) has to pay service tax** (i.e., the supplier pays the tax).
* If an individual is a **proprietor/partnership firm registered under service tax**, then they are liable under RCM.

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### 4. What should individuals do if they receive GR (Goods Receipt) without service tax charged, after 01.07.2012?

* If the individual is **not liable under RCM** (i.e., not falling under categories a-f), **they are not required to pay service tax**.
* However, they should **verify with the transporter** if they have paid service tax. If not, then **GTA is liable to pay service tax**.
* Individuals **should keep documentary evidence** showing they are not liable under RCM and maintain GRs accordingly.

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### Summary:

| Service Receiver Type | Service Tax Liability on Freight (After 01.07.2012) |
| ------------------------------------------ | --------------------------------------------------- |
| Factory/Company/Firm etc. (categories a-f) | **Service Receiver pays under RCM** |
| Individual (not proprietary concern) | **GTA pays service tax** (supplier liability) |

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If you want, I can also help draft a simple checklist or a note for individuals on how to handle these freight bills post 1 July 2012. Would that help?

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