Appellant challenges 'tour operator' status under Finance Act, 1994. Commissioner upholds penalties, waives pre-deposit pending appeal.

The appellant contended they did not qualify as a 'tour operator' under the Finance Act, 1994. The Commissioner (Appeals) upheld penalties and interest imposed but waived pre-deposit and stayed service tax recovery pending appeal, as the appellant's argument that they did not meet the tour operator criteria was not refuted.

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Issues involved: Interpretation of the definition of 'tour operator' u/s 65 of the Finance Act, 1994 and applicability of penalties u/s 76, 77, 78 and interest u/s 75.

Interpretation of 'tour operator' definition: The case involved the appellant engaged in transporting employees, contending that they do not qualify as a 'tour operator' as per the definition in Clause 115 of Sec. 65 of the Finance Act, 1994. The lower authorities did not establish that the appellant operated tourist vehicles covered by a permit u/s the Motor Vehicles Act, 1988.

Penalties and interest: The Commissioner (Appeals) upheld the demand and penalties imposed u/s 76, 77, 78 of the Finance Act, 1994, along with interest u/s 75. However, the submission that the appellant does not organize tours as required for a tour operator and does not transport passengers in vehicles covered by the Motor Vehicles Act, 1988 was not contradicted by the ld. SDR. Consequently, there was a waiver of pre-deposit and stay of recovery of the service tax until final disposal of the appeal.

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