SERVICE TAX ON RAILWAY FREIGHT-EXCEPTIONS

Friends

Service tax has been imposed on service provided to any person in relation to transport of goods, by rail in Finance Act(2) 2009.A new sub-clause (zzzp) of clause (105) of section 65 of the Finance Act,has been inserted in service tax act.The tax on this service is applicable from 01.09.2009.However at the time of introduction of this new service ,The Finance Minister has assured that a negative list of goods will be issued on which service tax on freight will be exempted.Now department has issued the negative list which is reproduced here under for your ready reference.

[TO BE PUBLISHED IN THE GAZZETE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

Government of India
Ministry of Finance
Department of Revenue

New Delhi, the 31^st August, 2009

Notification No. 28/2009 - Service Tax

G.S.R. (E).- In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994), (hereinafter referred to as the Finance Act), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts the taxable service provided to any person in relation to transport of goods, the description of which is specified in column (2) of the Table, by rail as referred to in sub-clause (zzzp) of clause (105) of section 65 of the Finance Act, from the whole of the service tax leviable thereon under section 66 of the Finance Act.

2. This notification shall come into force on the first day of September, 2009.

Table

Sl.No.	Description of Goods
(1)	(2)
1	Defence/ military equipments
2	Railway equipments/ materials
3	Postal mail bags
4	Relief materials meant for victims of natural or manmade disasters, calamities, accidents and mishap
5	Luggage of train passengers, whether carried as personal luggage in the train compartments or booked separately in the luggage van/Household effects
6	Parcels [including newspaper/magazines registered with Registrar of Newspapers] booked in the luggage vans, where the goods/commodity heads fall below train load class 130 as per the Indian Railway Conference Association(IRCA) Goods Tariff
7	The following goods which are classified in the IRCA Goods Tariff, as below train load class 130 and wagon load class 130 ( Formula: Train Load Class 120+10) including ‘Low Rate’ goods viz., LR1, LR2, LR3, LR4: Food grains, flours and pulses(9), Chemical Manure(6), Gunnies(21), Oil cakes and seeds(16), Soap(19), Starch(21), Salt for industrial use(18), Sugar(20), Salt (18),De-oiled cakes(16), Machinery and machine tools(14), Hides and Skins(12), Leather(12), Rubber and plastic(12), Electrical appliances and fittings(22), Empty drums(22), jerry cans and barrels(22), Jaggry(22), Jute(22), Milk and Milk products(22), Organic Manure(22), Paints and polishes(22), Timber(22), Vegetable oil pitches(22), Water(22), Fireworks(23), Boiler components(24), Charcoal(24), Paper(24) Bamboos(25), Brooms(25), Coffee and Tea(25), Cotton and other textiles(25), Fodder and Husk(25), Fruits and vegetables(25) and other perishables like fishery and marine produce, Groceries(25), Live stock(25), Motor vehicles(25), Sugar cane and Bagasse(25),Fire clay(7),Edible oils booked in covered wagons and charged as LR4, booked in 4 wheeled Tank wagon and charged as Train Load class-100
8	Kerosene oil meant for supply through public distribution system; Petroleum products including LPG Cylinders (filled and empty) booked by public sector Oil Marketing Companies transported by Indian Railways

F. No. 356/24/2009-TRU

Prashant Kumar
Under Secretary to the Government of India

CBEC has also issued a negative list for goods which is not covered under services in relation to transport of goods through national waterway, inland water and coastal shipping as referred to in sub-clause (zzzzl) of clause (105) of section 65 of the Finance Act

[TO BE PUBLISHED IN THE GAZZETE OF INDIA, EXTRAORDINARY, PART II, SECTION 3, SUB-SECTION (i)]

Government of India
Ministry of Finance
Department of Revenue

New Delhi, the 31^st August, 2009

Notification No. 30/2009 – Service Tax

G.S.R. (E).- In exercise of the powers conferred by sub-section (1) of section 93 of the Finance Act, 1994 (32 of 1994) (hereinafter referred to as the Finance Act), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby exempts the taxable service provided to any person in relation to the transport of goods, the description of which is specified in column (2) of the Table, through national waterway, inland water and coastal shipping as referred to in sub-clause (zzzzl) of clause (105) of section 65 of the Finance Act, from the whole of service tax leviable thereon under Section 66 of the said Act.

2. This notification shall come into force on the first day of September 2009.

Table

Sl.No.	Description of Goods
(1)	(2)
1.	Foodstuffs including edible oil seeds and edible oils; food grains (cereals and pulses) and flours; fruits, vegetables and flowers; agricultural, fishery, marine produce; meat and poultry; water; tea and coffee; salt, sugar, sugarcane; grocery; milk and milk products; livestock and cattle fodder; dhoties , sarees and voils; long cloth, sheeting Fertilizer whether inorganic, organic or mixed;
2	Petroleum and petroleum products;
3	Hank yarn made wholly from cotton;
4	Hank yarn made wholly from cotton;
5	Raw jute and jute textile;
6	Seeds of food crops and seeds of fruits and vegetables; seeds of cattle fodder and jute seeds;
7	Medicine/pharmaceutical products;
8	Relief materials meant for victims of natural or manmade disasters, calamities, accidents and mishap;
9	Defence/ military equipments.
10	Luggage of passengers, whether carried as personal luggage in the ship or booked separately as consignment/ postal mail / mail bags/Household effects
11	Newspaper/magazines registered with Registrar of Newspapers.

[F. No. 354/163/2009-TRU]

(Prashant Kumar)

Under Secretary to the Government of India