Services of transportation of goods
Services by way of transportation of goods
1) By road except the services of –
- Goods transportation agency
- A courier agency
2) By an aircraft or a vessel from a place outside India up to the customs station of clearance or
3) By inland waterways
Fall within the purview of exemption under the entry of negative list.
Taxability of goods transportation agency under service tax
Generally all services provided by goods transport agency are excluded from the negative list,
However, there are separate exemptions available to the services provided by the goods transport agency. These are services by way of transportation of –
- Fruits, vegetables, eggs, milk, food grains or pulses in a goods carriage;
- Goods where gross amount charged on a consignment transported in a single goods carriage does not exceed one thousand five hundred rupees; or
- Goods where gross amount charged for transportation of all such goods for a single consignee in the goods carriage does not exceed rupees seven hundred fifty.
Goods transport agencies are not liable to pay tax in all cases and the provisions relating to reverse charge, i.e. service tax is liable to be paid by the consigner or consignee in specified cases, are applicable even after the introduction of negative list.
Some transporters under-take door-to-door transportation of goods or articles and they have made special arrangements for speedy transportation and timely delivery of such goods or articles. Such services are known as ‘Express Cargo Service’ with assurance of timely delivery, such ‘Express cargo service’ is fall within the ambit of courier agency service. Hence, the said service is excluded from the negative list entry relating to transportation of goods by road.
“Courier” has been defined in section 65B as any person engaged in door-to-door delivery of time sensitive documents, goods or articles utilizing the services of a person, either directly or indirectly, to carry or accompany such documents, goods or articles.
‘Angadia’ undertakes delivery of documents, goods or articles received from a customer to another person for a consideration. Therefore, ‘angadias’ are covered within the definition of a ‘courier’ and services provided by angadia are liable to service tax.
Nature of service relating to transportation whether covered in the negative list entry or not
- By railways – No
- By air within the country or abroad – No
- By a vessel in the coastal waters – No
- By a vessel on a national waterway – Yes
- Services provided by a GTA- No
Services provided as agents for inland waterways are in the nature of services used for providing the negative list entry service of transport of goods on inland waterways and would not be covered by application of the rule and would not be exempt under service tax.