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In a significant ruling, the Telangana Authority for Advance Rulings (AAR) clarified the tax treatment of ancillary services provided along with Goods Transport Agency (GTA) services. In the case of DRS Dilip Road lines Limited [TSAAR Order No.07/2024 dated April 26, 2024], the AAR ruled that ancillary services such as packing, loading, unloading, and unpacking, when provided in conjunction with the main supply of transportation services, are not taxed separately. This article examines the facts, issues, and implications of this important ruling.


DRS Dilip Road lines Limited, (“the Applicant”) was a GTA service provider and opted to pay tax under forward charge mechanism and was further undertaking the enlisted services along with transportation of goods, namely: packing, loading, unloading and unpacking as ancillary services.

The Applicant submitted that clients prefer the bundled service during shifting of household goods which includes packing, loading, unloading & unpacking apart from transportation service.

However, the applicant was confused whether providing the ancillary of services along with the main service of transportation would be covered under GTA service?


Whether ancillary services namely: packing, loading, unloading and unpacking provided along with the transportation service would be covered under the ambit of GTA Service?

Ancillary services provided along with GTA services are not taxed separately


The Telangana, AAR in TSAAR Order No.07/2024, held as under:

Explanation.- for the purpose of this notification,- “goods transport agency” means ,-any person who provides service in relation to transport of goods by road and issues consignment note, by whatever name called.

  • Noted that, the entry in the notification enumerates ‘Services in relation’ to transport of goods by road. Thus all services rendered in relation to transportation of goods fall under this entry provided that such services have a direct and immediate link with the agreement for transport of goods i.e., the contract shall be for transport, packing, loading, unloading and unpacking of the same goods.
  • Ruled that, the ancillary services provided by the Applicant viz., transport, packing, loading, unloading of the same goods to their customers are covered under the category of GTA services.

Conclusion: The Telangana AAR’s ruling in the case of DRS Dilip Road Lines Limited provides crucial clarity on the inclusion of ancillary services within GTA services. By ruling that these services, when directly linked to the main transportation service, are not taxed separately, the AAR has simplified compliance for GTA service providers offering bundled services. This decision ensures that businesses can provide comprehensive logistics solutions without facing additional tax burdens on ancillary services, provided they are part of the transportation contract.


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June 2024