Page 113 - GSTL_11th June 2020_Vol 37_Part 2

2020 ] GUNESH LOGISTICS v. COMMISSIONER OF C. EX. & SERVICE TAX, JAIPUR-I 199
“65(105)(zzzzj) to any person, by any other person in relation to supply of
tangible goods including machinery, equipment and appliances for use,
without transferring right of possession and effective control of such ma-
chinery, equipment and appliances;”
Post-Negative List
18. Section 66B provides that there shall be levied a tax to be referred to
as service tax on the value of all services, other than those services specified in
the negative list, provided or agreed to be provided in the taxable territory by
one person to another and collected in such a manner as may be prescribed. The
‘negative list’ is provided for in Section 66D of the Act. Section 65B(44) of the Act
as inserted w.e.f. 1 July, 2012 defines ‘service’ to mean any activity carried out by
any person for another for consideration and includes a declared service but
would not include certain services specified in clauses (a), (b) and (c). Declared
services have been enumerated in Section 66E of the Act. Sub-clause (f) of Section
66E, which is relevant for the purposes of the controversy involved in this ap-
peal, is as follows :-
“(f) transfer of goods by way of hiring, leasing, licensing or in any such
manner without transfer of right to use such goods;”
19. The appellant claims to be transporting RMC in vehicles under the
contract awarded by the customers, particularly Grasim Industries Ltd. and Ul-
tratech Cement Ltd. This transportation of RMC takes place in transit mixers
from the premises of the customers on the basis of work orders issued. A perusal
of the work order dated 1 April, 2008 issued to the appellant by Grasim Indus-
tries Ltd. indicates that the appellant was required to load RMC in the vehicles of
the appellant and transport the same to the required destinations where it was
required to be unloaded. The transportation charges payable to the appellant
were in two parts. The appellant was to receive Rs. 140/- per cum for the quanti-
ty of RMC transported during the month. Under the second part, the appellant
was to receive Rs. 20.34 per km for distance travelled in the transportation of
RMC.
20. It is clear that under the work order, the appellant was required to
load RMC in the vehicles belonging to the appellant and thereafter transport the
RMC to the required destination and unload it. The work order does not speak of
hiring the vehicles of the appellant. In fact the appellant was required to keep all
its vehicles used for providing the service under the agreement in good working
condition with periodical service and repair. The Commissioner has, however
concluded from a perusal of the work order that the recipient of service i.e. M/s.
Grasim Industries Ltd. and M/s. Ultratech Cement Ltd. needed a large number
of vehicles for transportation of RMC from their plant to the premises of the cus-
tomer and they have entered into an agreement for deployment of 6M3 capacity
vehicles which can be used by the recipient and serve as per their requirement.
The Commissioner, therefore, observed that the appellant had given on hire ve-
hicles to the service recipient for use in the transportation of RMC from its plant
to the premises of the customer though the right to possession and effective con-
trol over the vehicles remained with the appellant and it had to deploy manpow-
er to operate and control the vehicles.
21. This conclusion drawn by the Commissioner is a patently wrong
understanding of the conditions of the work order. The appellant did not give on
hire the vehicles. Even the subject matter of the “work order is for transportation
of Ready Mix Concrete in vehicle/vehicles from our Jaipur 1TD Ready Mix Plant
GST LAW TIMES  11th June 2020  113