Service tax payable on local transport

Service Tax is payable by the Service Receiver not the Service Provider. The Goods Transport Agency is covered under Reverse Charge Mechanism under Service Tax and the Service Receiver is laible to pay Service tax after abatement, which is cuurently at 70% i.e., the tax rate including cess will be 4.50%. 

In you case the factory is liable to pay Rs.40.50 (Rs.900 * 4.50%)