Section 66D(P)(i)(A) of Finance Act exempts service of goods transportation by person other than GTA

Chartered Logistics Limited Vs C.C.E (CESTAT Ahmedabad)

CESTAT Ahmedabad held that services of transportation of goods by a person other than GTA are clearly exempt under Section 66D (P)(i)(A) of the Finance Act, 1994.

Facts- An intelligence was gathered by the officers of DGGI that appellant had provided taxable services in relation to ‘managing distribution and logistics’ and ‘operational or administrative assistance’ in business to M/s Reliance Supply Chain Solution Ltd. (M/s RSCPL) & M/s Fine Tech Corporation Pvt. Ltd. (M/s FCPL) from their various Branch Offices situated all over India.

The service provided includes services like safe transportation of goods, upkeep of the vehicles, to check on route pilferages, maintain consistency, also provide drivers/ supervisors on 24 hours/ day basis and arrange diesel for the vehicles.

Appellant had reportedly charged service charges on fixed lump sum basis per month per vehicle and variable cost at agreed rate for their own vehicles which appeared to be the consideration received against “supply of tangible goods for use” service which was taxable. Appellant had not issued any consignment note/LR in regards to such services for transportation of any of the consignments. Appellant was not paying service tax on the aforesaid service activity.

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