Devendra Nath Mahato & Sons Vs Commissioner of Central Excise & Service Tax (CESTAT Kolkata)
Service Tax Demand Quashed Because Coal Transport Activity Was Misclassified as Mining Service; No Service Tax on Coal Transportation Because Activity Fell Under Negative List Entry: CESTAT; Mining Service Classification Rejected Because Contract Was Limited to Transportation of Coal; Coal Movement Through Public Roads Not Mining Service, Service Tax Demand Set Aside.
The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Kolkata, allowed the appeal filed by a transporter engaged in transporting raw coal and washery rejects between mines operated by Bharat Coking Coal Limited and facilities of Tata Steel Limited. The dispute concerned the classification of the appellant’s activities for service tax purposes during the period from 2008-09 to 2012-13.
The appellant transported raw coal from mine pitheads to Jamadoba Coal Washery and transported washery rejects from different mines to the Ground Hopper of Tata Steel’s power plant. Following an investigation, the Department issued a show cause notice demanding service tax of ₹42.09 lakh, along with interest and penalties, by classifying the activities as “Mining Service.” The Department contended that since no consignment notes were issued, the services could not be classified as “Transport of Goods by Road Service.” It further argued that the work orders indicated activities connected with mining operations and therefore taxable under “Mining of Mineral, Oil or Gas Service.”
