Tour operator service does not cover fixed employee transport in contract carriages absent tourist vehicle status or tour planning.

Tour operator service did not apply to the fixed transportation of company employees in contract carriages. For the period before 10.09.2004, the levy failed because the vehicles were not shown to be tourist vehicles as required under the then-applicable statutory definition. For the period on and after 10.09.2004, the amended definition still did not cover the activity because the appellant only supplied contract carriages on agreed routes and timings, without independently planning, scheduling, organizing or arranging tours. The impugned levy was therefore unsustainable for both periods, and the assessment was set aside.

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Issues: (i) Whether transportation of company employees in contract carriages between fixed points and the factory or establishment is taxable as tour operator service for the period prior to 10.09.2004; (ii) Whether the same activity falls within the amended definition of tour operator service on or after 10.09.2004.

Issue (i): Whether transportation of company employees in contract carriages between fixed points and the factory or establishment is taxable as tour operator service for the period prior to 10.09.2004.

Analysis: For the pre-amendment period, tour operator service applied only where the vehicle was a tourist vehicle covered by the statutory definition under the Motor Vehicles law and the relevant rules. The vehicles used by the appellant were contract carriages and were not shown to conform to the requirements of tourist vehicles under the applicable rules. Since the essential statutory condition was absent, the activity could not be brought within the levy.

Conclusion: The demand for the period prior to 10.09.2004 was not sustainable and the issue was decided in favour of the assessee.

Issue (ii): Whether the same activity falls within the amended definition of tour operator service on or after 10.09.2004.

Analysis: After the amendment, the levy extended to persons engaged in planning, scheduling, organizing or arranging tours, including package tours by any mode of transport. The appellant merely supplied contract carriages to customers on agreed terms for fixed routes, timings and consideration. No material showed that the appellant independently planned, scheduled, organized or arranged tours, and the vehicles also did not qualify as tourist vehicles. The amendment was directed to package tours and similar organized travel arrangements, not to a mere transport arrangement of the kind involved here.

Conclusion: The amended definition did not cover the appellant's activity, and the issue was decided in favour of the assessee.

Final Conclusion: The impugned levy could not be sustained for either period, and the appeal succeeded with the assessment set aside.

Ratio Decidendi: Liability under tour operator service arises only when the statutory conditions for the relevant category are satisfied, and a mere supply of contract carriages for fixed employee transportation is not equivalent to planning, scheduling, organizing or arranging tours.

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