Coal Transport with Incidental Loading Is Not Cargo Handling Service: CESTAT Allahabad

CESTAT Allahabad set aside a ₹2.01 crore demand on a coal transporter for mining companies, holding that loading coal into tipping trucks was incidental to transport and that its earlier win had attained finality.

The Customs, Excise and Service Tax Appellate Tribunal (CESTAT), Allahabad, has held that transporting coal within mining areas in tipping trucks, with loading as an incidental step, is in substance transportation of goods and cannot be taxed as cargo handling service [R.P.L. Projects Limited v. Commissioner, C.G.S.T. and Central Excise, Varanasi, 2026-juristway.com-3348-CESTAT(Allahabad)-ST].

The Bench of P.K. Choudhary, Member (Judicial), and K. Anpazhakan, Member (Technical), heard the appeal; the order was written by Mr. Anpazhakan. The appellant transported coal for Northern Coal Fields Ltd. and other contractors, within mining areas and from stockyards and pitheads to points such as the coal handling plant. The Commissioner’s order dated 28 Nov 2025 confirmed ₹2,01,05,042 for 2016-17 and 2017-18 up to 30 Jun 2017 under cargo handling service, with penalty under Section 76.

The Tribunal held that the essential character of the activity was transportation, and the definition of cargo handling service itself excludes transportation of goods. The appellant had always invoiced the work as transport, and the recipients had paid tax on that basis, which the Department accepted. It followed M/s. Maa Kalika Transport Pvt. Ltd. v. Commissioner of C.G.S.T. and Central Excise, Rourkela (2023), which relied on CBEC Circulars 104/07/2008-S.T. and 186/5/2015-ST treating loading and unloading as part of a composite transport service. It also followed Naresh Kumar & Company Pvt. Ltd. v. Commissioner of Service Tax, Kolkata (2025).

The issue had already been settled in the appellant’s own case. A demand for the earlier period, raised by a show cause notice (SCN) dated 19 Apr 2016, was dropped on 5 Oct 2017, and the Tribunal upheld that by Final Order No. 71120/2018 dated 23 May 2018. The Revenue’s appeal (Civil Appeal No. 4988/2021) was disposed of by the Supreme Court on 20 Sep 2024 on the ground of the monetary limit. The present SCN was periodical and had been kept in the call book pending that outcome, so the earlier decision had attained finality.

The demand and the penalty under Section 76 were set aside, and the appeal was allowed with consequential relief.

2026-juristway.com-3348-CESTAT(Allahabad)-ST