BACKGROUND

As we know the Goods Transport Agency (GTA) services are taxable under the Finance Act, 1994 and abatement has also been provided @ 70 per cent vide abatement Notification dated June 20, 2012. Sometimes, the GTA service providers provide various auxiliary services such as loading/unloading/packing/unpacking etc.

The regime of Service Tax has been changed from positive list based to Negative List based approach w.e.f July 01, 2012 by which all services except those covered under the Negative List as mentioned under Section 66D or exempted vide Mega Exemption Notification are chargeable to Service Tax.

In this regard, the All India Transport Welfare Association (AITWA) has represented regarding the difficulties being faced by the Goods Transport Agencies (GTAs) in respect of Service Tax levy on the services of goods transport. Doubts have been raised by the All India Motor Transport Congress (AIMTC) regarding treatment given to various services provided by GTAs in the course of transportation of goods by road.

 CLARIFICATION BY CBEC

The Central Board of Excise & Customs vide Circular No.186/5/2015-ST dated October 05, 2015 has clarified as under:

(i)       Various Ancillary Services such as loading/ unloading, packing/unpacking, transhipment, temporary storage etc., which are provided in the course of transportation of goods by road shall be treated as a single service i.e. GTA;

(ii)      A single composite service need not be broken into its components and considered as constituting separate services, if it is provided as such in the ordinary course of business. Thus, 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;

(iii)     If ancillary services (mentioned above) are provided in the course of transportation of goods by road and the charges for such services are included in the invoice issued by the GTA, and not by any other person, such services would form part of GTA service and, therefore, the abatement of 70%, presently applicable to GTA service, would be available on it;

(iv)     The abatement provided under the Notification No. 26/2012-ST dated June 20, 2012 is available if-

          (a) the entire transportation of goods is by road; and

          (b) the GTA issues a consignment note, by whatever name called

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http://www.cbec.gov.in/htdocs-servicetax/st-circulars/st-circulars-2015/st-circ-186-2015