2025-VIL-1533-CESTAT-HYD-ST
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SERVICE TAX CESTAT Cases

Service Tax – Rule 2(1)(d)(v) of Service Tax Rules, 1994 – Transportation of goods – Incurring of expenditure – Tax liability – On basis of various documents, department came to conclusion that Appellant had incurred expenditure on account of transportation of goods, but had not paid service tax under category of Transportation of Goods by Road service (GTA) – Department issued show cause notice to Appellant by proposing demand of Service Tax – Commissioner confirmed demand under Reverse Charge Mechanism in terms of Rule 2(1)(d)(v) of the Rules – Whether Appellant is liable to pay service tax on GTA service by virtue of Rule 2(1)(d)(v) of the Rules in view of their having incurred expenditure on account of transportation – HELD – It is an admitted fact that Appellant outsourced hired trucks for transporting ore to their customers and incurred expenses towards freight. To fall under GTA service, it would be a mandatory requirement that person providing transport service has to issue a consignment note. Department has not adduced any evidence to effect that truck operators, who provided trucks on hire basis to Appellant had issued any Consignment Note. When there is no issuance of consignment note, there cannot be a GTA service. Since service of GTA has not been provided by truck operators to Appellant, Rule 2(1)(d)(v) of the Rules would not be applicable merely because Appellant was initially paying freight and thereafter recovering same from their customer. Demand of service tax on GTA service against Appellant will not survive. Impugned order is set aside – Appeal allowed
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