service tax on unloading and loading charges

This query is : Resolved 

25 March 2009

Dear Sir,
i have a doubt regarding service tax liability on unloading and loading charges paid to coolie or daily labors.
actualy a dealer got material from Manuf. in purchase invoice it is clearly mentioned that freight exp wil be born by consignor so Service Tax liability is on consignor and consignor had paid service tax on freight expenses accordingly.
but in that invoice it as mentioned that unloading charges will be borne by consignee i.e. the responsibility to unload the material lies on consignee
when the lorry carrying above goods reaches to consignee godown, consignee himself arrange coollies to unload the material from Truck.
Now deptt. is asking for pay service tax on above unloading charges paid to coolies.
i would like to add here that these coollies are from unorganised sector and not having receipts more than exempted limit. And the invoice raised by GTA does not include unloading charges therefor no payment is made to GTA for unloading Charges.
deptt is saying that it is does not matter that whoever is receiver of unloading charges. it is not necessary that payment must be made to GTA.
is deptt stand correct.
shall we pay service tax on these loading and unloading charges to coollies
if yes whether 75% abatment can be claimed and exemption upto Rs 750 can be claimed

Shyam Lal Naik (Expert)
25 March 2009


The department is not correct. As is well known, department raises frivilous, often rediculous demand and SCN.

Since the consignee has engaged coolies to unload, it is a self service. There is no service provider and service receiver relationship.

If at all, coolies are treated as service provider, let the department track them and raise SCN.

Since the GTA is not providing the service, the question of considering the amount of unloading charge, part of GTA service does not arise.

In place of making the payment, if possible, you should go in for remedies provided in the statute.

It is not uncommon to find department issueing SCN on the service receiver under GTA and the service provider under Cargo Handling on the same service.

narendra khandelwal (Querist)
25 March 2009

In SCN they have mentioned the time limit for payment of service tax as 31.03.09.

in this short span of time what are the remidies provided in the statue.

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