2007 (8) TMI 178 - AT - Service Tax

Tribunal rules in favor of transportation service provider in 'Rent-a-Cab' liability dispute.

The Tribunal found in favor of the appellant, who was providing transportation services for a media company but was alleged to be liable as a 'Rent-a-Cab' ... ‘Rent-a cab’ operator – In view of Tribunal decision, transport operation under contract in which amounts are received for each trip depending upon distance, time etc. would not come under the category of ‘Rent-a-cab’ service – Appeal allowed and appellant is not liable to pay service tax Issues:1. Whether the appellant is liable under the category of 'Rent-a-Cab' operator for transporting newspapers.Analysis:The appellant, owning an Ambassador Car and two tempos, was providing transportation services for a media company. The Revenue alleged non-compliance under the 'Rent-a-Cab' operator category. The Departmental Representative argued that the appellant, registered as a 'Taxi Cab' with transport authorities, was receiving remuneration from the service recipient, thus falling under 'Rent-a-Cab' services. However, the Consultant referred to a Tribunal decision where a similar transport operation was not classified as 'Rent-a-Cab' service, emphasizing that only goods were transported, not passengers.Upon careful consideration, the Tribunal found no evidence of the vehicles being rented-out to the service recipient. The appellant, an illiterate individual, maintained trip sheets as basic accounts. Despite lacking detailed records, payments were made based on trips. The Tribunal, drawing parallels to the cited case, concluded in favor of the appellant. The decision highlighted that the payment received was for transporting goods, not passengers, supporting the appellant's position. Consequently, the appeal was allowed, granting relief to the appellant.