The Central Board of Excise and Customs, the Government of
India, vide circular No. 186/5/2015-ST dated 05.10.2015, clarified
the doubts raised by the All India Motor Transport Congress (AIMTC)
regarding treatment given to various services provided by Goods
Transport Agencies in the course of transportation of goods by
Goods Transport Agency ("GTA") has been defined to
mean any person who provides service to a person in relation to
transport of goods by road and issues consignment note, by whatever
name called. In addition to transportation services, GTA also
provides various ancillary services such as loading/ unloading,
packing/unpacking, transhipment, temporary storage etc., which are
provided in the course of transportation of goods by road.
The clarifications with regard to levy of service tax on such
services provided by GTAs as provided in the Circular have been
summarized as follows:
1. Various services provided by GTA in transportation of goods
by road shall be treated as part of GTA service
The ancillary services may be provided by GTA himself or may be
sub-contracted by the GTA. In either case, for the service
provided, GTA issues a consignment note and the invoice issued by
the GTA for providing the said service includes the value of
ancillary services provided in the course of transportation of
goods by road. These services are not provided as independent
activities but are the means for successful provision of the
principal service, namely, the transportation of goods by road.
2. Composite service need not be broken into its
A single composite service need not be broken into its
components and considered as constituting separate services, if it
is provided as such in the ordinary course of business. Thus, a
composite service, even if it consists of more than one service,
should be treated as a single service based on the main or
principal service. While taking a view, both the form and substance
of the transaction are to be taken into account.
3. Abatement of 70% to GTA services available to the entire
If ancillary services are provided in the course of
transportation of goods by road and the charges for such services
are included in the invoice issued by the GTA, and not by any other
person, such services would form part of GTA service, and,
therefore, the abatement of 70%, presently applicable to GTA
service, would be available on it.
4. Conditions for applicability of Abatement Notification
For the purpose of availing the abatement under Notification No.
26/2012-ST dated June 20, 2012 (S. No. 7), in cases where GTA
undertakes to reach/deliver the goods at destination within a
stipulated time, it should be considered as 'services of goods
transport agency in relation to transportation of goods' under
such notification only if:
a) The entire transportation of goods is by road; and
b) The GTA issues a consignment note, by whatever name
Apart from the above, the circular also clarifies that the
pending disputes on the above issues shall be dealt with
accordingly and expeditiously by the Department of Revenue.
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