Mata Dadhimati Transport Vs Commissioner of CGST & Central Excise (CESTAT Kolkata)
The appeal before the CESTAT Kolkata arose from an order confirming demand of service tax along with an equivalent penalty under Section 78 of the Finance Act, 1994. The demand related to activities undertaken by the appellant in connection with transportation and loading of iron ore fines.
The appellant was engaged in two distinct activities for its clients: (i) local transportation (shifting) of iron ore fines from the stockyard to the railway siding over a distance of about 6 kilometres, and (ii) loading of iron ore fines into railway wagons. The appellant was registered under the Finance Act, 1994 for providing “Cargo Handling Services” and had been discharging service tax liability on wagon loading activities under that category. There was no dispute regarding payment of service tax on wagon loading.
The appellant received separate work orders from two clients, each prescribing separate rates for local transportation of iron ore and for wagon loading. Separate invoices were raised for these two activities. While service tax was paid on wagon loading, the appellant did not pay service tax on local transportation charges. The appellant claimed that local transportation was classifiable as “Goods Transport Agency (GTA) Services” and, under Rule 2(1)(d)(v) of the Service Tax Rules, 1994, the liability to pay service tax rested on the service recipient and not on the service provider.
