Service Tax - Truce with Truckers – Board keeps the word and clears the air.
Remember the three day strike by the transport operators in the first week of July 2008? The strike was called off after getting assurance that the Service Tax agreement of 2004 would be honoured. The Board has now issued a clarification in respect of certain issues relating to this service.
Composite service is classifiable as GTA service:
The composite service of goods transport may include various intermediate and ancillary services provided in relation to the principal service of the road transport of goods. Such intermediate and ancillary services may include services like loading/unloading, packing/unpacking, transhipment, temporary warehousing etc., which are provided in the course of transportation by road. A composite service, even if it consists of more than one service, should be treated as a single service based on the main or principal service and accordingly classified Thus, if any ancillary/intermediate service is provided in relation to transportation of goods, and the charges, if any, for such services are included in the invoice issued by the GTA , and not by any other person, such service would form part of GTA service and, therefore, the abatement of 75% would be available on it.
GTA + Cargo Handling = GTA:
Cargo handling service means loading, unloading, packing or unpacking of cargo and includes the service of packing together with transportation of cargo with or without loading, unloading and unpacking. Transportation is not the essential character of cargo handling service but only incidental to the cargo handling service. Where service is provided by a person who is registered as GTA service provider and issues consignment note for transportation of goods by road in a goods carriage and the amount charged for the service provided is inclusive of packing, then the service shall be treated as GTA service and not cargo handling service
GTA Vs Courier Service:
Whether time sensitive transportation of goods by road in a goods carriage by a GTA shall be classified under courier service and not GTA service? On this issue, it is clarified that so long as, (a) the entire transportation of goods is by road; and (b) the person transporting the goods issues a consignment note, it would be classified as ‘ GTA Service'
These clarifications have retrospective effect as the C ircular clearly states, “ Pending disputes on the above issues may accordingly be decided expeditiously.”
Hundreds of cases are pending at various levels and all of them will be disposed of soon hopefully.
DDT 896 - 27.06.2008 , had noted, “ Normally the Government is quick to react to representations from the Transport sector, for they can literally take to the roads”, to which, a Netizen had reacted as,
I agree with your comments that the CBEC responds faster on representations from the GTA. It is my personal experience that any representation made through forums like the CII , FIEO , FICCI or even directly with the Board goes to the waste paper box. The only way to wake them up is to drag them to the court. Now there is a better alternative, thanks to TIOL's tip. Go through either the All India Motor Transport Congress or Confederation of Goods Vehicles Owners Association. Better still through both.
CBEC Circular No. 104/ 07 /2008-Service Tax Dated 6th August, 2008