Taxability under service tax

As per Notification 26/2012 - taxable portion of Transpotation of goods by Rail is 30% - that is 3.708%.

whereas, taxable portion of transpotation of goods by a GTA is 25% - that is 3.09%.

Further, exemptions is granted for services under both heads ( GTA and Rail) subject to conditions specifed in the MEGA Exemption notification 25/2012.

1. Services by way of transportation by rail or a vessel from one place in India to another of the following goods -

(a)  petroleum and petroleum products falling under Chapter heading 2710 and  2711 of the First Schedule to the Central Excise Tariff Act, 1985 (5 of 1986);

(b)  relief materials meant for victims of natural or man-made disasters, calamities, accidents or mishap;

(c)   defence  or military equipments;

(d)  postal mail or mail bags;

(e)  household effects;

(f)    newspaper or magazines registered with the Registrar of Newspapers;

1. railway equipments or materials;

(h)  agricultural produce;

(i)    foodstuff including flours, tea, coffee, jaggery, sugar, milk products, salt and edible oil, excluding alcoholic beverages; or

(j)    chemical fertilizer and oilcakes;

2. Services provided by a goods transport agency by way of transportation of -

1. fruits, vegetables, eggs, milk, food grains or pulses in a goods carriage;
2. goods where gross amount charged for the transportation of goods on a consignment transported in a single goods carriage does not exceed one thousand five hundred rupees; or
3. goods, where gross amount charged for transportation of all such goods for a single consignee in the goods carriage does not exceed rupees seven hundred fifty.

Further, service tax is to be paid under reverse charge mechanism for Goods transported by Road. No such reverse charge obligation in case of goods transported by Railways.

i hope this answers your Query.