Service tax on hired one crane for our shut down work
This query is : Resolved
27 August 2011
We have hired one Crane(Chain Mounted)- for our Shut down work “ Crane Hiring for Equipment replacement.
Party is charging the Service tax on Crane Hire charges.
1) My Question is where the crane come under Vehicle Act.
2) Whether we can avail service tax on Crane hiring and mobilization bill charge by party
Party is charging the Service tax on Crane Hire charges.
1) My Question is where the crane come under Vehicle Act.
2) Whether we can avail service tax on Crane hiring and mobilization bill charge by party
27 August 2011
Crane hire charges are liable to service tax under 'supply of tangible goods' service.
Service receiver is not entitled,in this case, to avail cenvat credit.
Service receiver is not entitled,in this case, to avail cenvat credit.
Message likes :
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27 August 2011
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24 July 2025
Here’s the clarification on **Service Tax on Crane Hiring** for your shutdown work:
---
### 1) Does the crane come under the Vehicle Act?
* A **crane (chain-mounted or otherwise) is considered a motor vehicle under the Motor Vehicles Act** when it is used for transportation on roads.
* However, **if the crane is hired only for lifting or handling services on-site (not for road transport), it is not treated as a goods carriage** under the Service Tax law.
---
### 2) Whether Service Tax is applicable on Crane Hiring and Mobilization charges? Can you avail CENVAT credit?
* **Crane Hiring is taxable under "Renting of motor vehicles service" only if the crane qualifies as a goods carriage under Motor Vehicles Act and is used for transportation of goods.**
* If the crane is hired just for lifting during shutdown work (i.e., on-site service) and not for goods transportation, **Service Tax is leviable under the category "Support services" or "Equipment hire service," but not under goods transport agency (GTA).**
* **Regarding CENVAT credit:**
* If the Service Tax is paid on Crane Hiring which is related to your business activity (like shutdown work in manufacturing), **you are eligible to avail CENVAT credit on such service tax paid**, provided the service is used for taxable output service or manufacture.
* Mobilization/demobilization charges are generally considered part of the service and attract service tax similarly.
---
### Summary:
| Aspect | Position |
| ------------------------------- | ----------------------------------------------------------------- |
| Crane under Motor Vehicles Act? | Yes, if used for transportation on road; else No |
| Service tax applicability | Yes, on crane hiring service as Equipment Hire or Support service |
| CENVAT credit eligibility | Yes, if used for business/manufacturing activities |
---
If you want, I can help you find the exact service tax notification or classification for crane hiring or assist in accounting treatment. Would you like that?
---
### 1) Does the crane come under the Vehicle Act?
* A **crane (chain-mounted or otherwise) is considered a motor vehicle under the Motor Vehicles Act** when it is used for transportation on roads.
* However, **if the crane is hired only for lifting or handling services on-site (not for road transport), it is not treated as a goods carriage** under the Service Tax law.
---
### 2) Whether Service Tax is applicable on Crane Hiring and Mobilization charges? Can you avail CENVAT credit?
* **Crane Hiring is taxable under "Renting of motor vehicles service" only if the crane qualifies as a goods carriage under Motor Vehicles Act and is used for transportation of goods.**
* If the crane is hired just for lifting during shutdown work (i.e., on-site service) and not for goods transportation, **Service Tax is leviable under the category "Support services" or "Equipment hire service," but not under goods transport agency (GTA).**
* **Regarding CENVAT credit:**
* If the Service Tax is paid on Crane Hiring which is related to your business activity (like shutdown work in manufacturing), **you are eligible to avail CENVAT credit on such service tax paid**, provided the service is used for taxable output service or manufacture.
* Mobilization/demobilization charges are generally considered part of the service and attract service tax similarly.
---
### Summary:
| Aspect | Position |
| ------------------------------- | ----------------------------------------------------------------- |
| Crane under Motor Vehicles Act? | Yes, if used for transportation on road; else No |
| Service tax applicability | Yes, on crane hiring service as Equipment Hire or Support service |
| CENVAT credit eligibility | Yes, if used for business/manufacturing activities |
---
If you want, I can help you find the exact service tax notification or classification for crane hiring or assist in accounting treatment. Would you like that?
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