In re Utkal Coal Mining India Private Limited (GST AAR Odisha)
In the case of Utkal Coal Mining India Private Limited, the applicant sought clarification on the taxability and applicable GST rate for the transportation of minerals (specifically coal) from the mining premises to various points as per the requirements of NALCO, their client. The key points of contention were whether this service should be classified under “Renting of transport vehicles with operator” (SAC 996601) and what GST rate should apply.
Background and Arguments:
Utkal Coal Mining India Private Limited operates under a Coal Mining Agreement (CMA) with NALCO, acting as a Mine Developer and Operator (MDO). Among the services provided under this agreement, one significant aspect is the transportation of coal from the mining stockyard to railway sidings or delivery points designated by NALCO. This transportation is carried out using vehicles supplied with drivers by Utkal Coal Mining India Private Limited.
Applicant’s Position:
The applicant argued that the service of transporting minerals should be categorized under SAC 996601, “Renting of transport vehicles with operator,” and should attract a GST rate of 12%. They based this contention on Circular No.177/09/2022-TRU dated 03.08.2022 issued by the CBIC, specifically referring to Clause 9. According to this circular, services involving the rental of trucks and other freight vehicles with drivers for specified durations are classified under SAC 9966 and are not eligible for the exemption under Sl. No. 18 of notification No. 12/2017- Central Tax (Rate) .
