Bullock cart drivers are not gta service providers – cestat

Tejas Jain (Chartered Accountant) (314 Points)

18 September 2012  

When service is provided to a customer by a goods transport agency in relation to transport of goods by road in a goods carriage that shall be liable to service tax. Of course the liability may be borne either by the consignor or by the consignee of the goods. Section 65(50b) requires goods transport agency to be a commercial concern and if that concern provides service in relation to transport of goods by road and issues consignment notes by whatever name called such an agency is brought under the fold of law. The term “consignment notes” having been defined by Rule 4B it is to be read together with section 65 (50b) of Finance Act 1994. According to Rule 4B goods transport agency which should necessarily satisfy the requirement of section 65 (50b) if that agency provide service in relation to transport of goods by road in goods carriage and shall issue consignment note to the customer. Issuance of such consignment note is dispensed in terms of section 93 where the service is provided under that section. The explanation to the rule brings out what should be contents to the consignment notes. There are certain particulars which need to be stated in the consignment notes. The explanation requires that the consignment note is to be issued by goods transport agency against the receipt of the goods for the purpose of transport. The consignment note so issued is to be serially numbered and should contain names of the consignor and consignee. So also consignment note should contain registration number of the goods carriage, in which the goods are transported. It has also to provide details of goods and details of place of origin and destination. When we read meaning of consignment note with the taxing entry under section 65 (105) (zzp) of the aforesaid Act it is inconceivable to bring the bullock carts transporting sugar cane to the fold of law, since law requires the transport made by goods carriage should only be brought to tax. This can be said following the mandate of rule 4B because registration number of goods carriage is a necessary requirement to be stated in the consignment notes. Therefore, the appellants are correct to say that if the sugar cane is transported by bullock cart, there shall be no levy at all.