Narayan Prasad Gour Vs. CGST, CE & ST, Bhopal - (Customs, Excise and Service Tax Appellate Tribunal) (30 Oct 2018)

Activity of transporting of coal from pithead of mines to railway siding is classifiable under Transport of Goods by road services

MANU/CE/0495/2018

Service Tax

The Appellants are engaged in providing taxable services under the category of "Goods Transport Agency Services" to Western Coal Field Ltd. during the period January 2009 to March 2011. Show Cause Notices were issued on the ground that, the Appellants were doing loading, transport and unloading of coal from mining under the category of "Cargo Handling Services".

The basic issue for adjudication is that whether the Department is correct in holding that, the service provided by the above mentioned Appellants falls under the category of cargo handling services as defined under Section 65(105)(zr) read with Section 105(23) of the Finance Act, 1994/Act or whether the service tax is correctly been paid by recipient of the service under Goods Transportation Agency service on reverse charge basis.

As per Section 65A(2)(b) of Act, the classification in the case of combined service is to be decided by analyzing the fact as to which service gives essential character to the service being performed. Further as can be seen from the above contract that, the essential character of the service for which contract has been entered by the service provider is that, the service received are for transportation of coal for mining area to the railway siding and the activity of loading/unloading mechanically or otherwise is only incidental to the activity of transportation of the cargo in these cases. The service provided by the Appellants has rightly been classified in the Goods Transportation Agency service.

This issue has already been examined by the Hon'ble Supreme Court in their decision in the case of CCE & ST Raipur Vs. Singh Transporters wherein the Hon'ble Supreme Court has held that, activity undertaken by the Assessee of transporting of coal from the pithead of the mines to railway siding is more appropriately classifiable under service head of Transport of Goods by road services. There is no merit in the impugned order, the same is set-aside and the appeal is allowed.

Relevant : CCE & ST Raipur Vs. Singh Transporters [MANU/SC/1177/2017: (2017 (4) GSTL 3 (SC)]

Tags : GOODS TRANSPORTATION SERVICES CATEGORY