Service tax GTA – DGST’s clarification – Truly withdrawn

By Vijay Kumar

Since DDT carried the information on 13-04-2005 that the DGST has withdrawn its controversial clarification on service tax on GTA, we were flooded with request for copies of the clarification. While the Chief Commissioners were very prompt in sending to the field the DGFT’s original, clarification it appears that withdrawal of the letter has not been communicated to the field. One hapless assessee wrote to us that his Range Officer is asking him to produce a copy of the DGST’s letter or pay higher tax.

We confirm that the DGST has indeed withdrawn the clarification in a letter address to all the Chief Commissioners. The letter states :

“The letter F NO V/DGST/43-GTO/02/2005 dated 30.3.2005 issued by this Directorate in respect of applicability of Notification No 32/2004 dated 03.12.2004 is hereby withdrawn.”

And it is signed by the DG himself. It would be very nice if the DG gives an official clarification that his original clarification is withdrawn to avoid further damage.