Service tax demand must stay within the show cause notice, and tour operator liability depends on a statutory tourist vehicle.

A service tax demand cannot be sustained on a ground different from the one set out in the show cause notice; confirmation on a new basis falls outside the scope of the proceedings and is invalid. Liability as a tour operator arises only where the service provider operates tours in a tourist vehicle meeting the statutory requirements under the motor vehicles law and prescribed rules. As the vehicles held contract carriage permits and did not satisfy the tourist vehicle definition, the levy was not attracted and the demand was set aside with consequential relief.

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Issues: (i) Whether service tax demand could be confirmed on a ground different from the one stated in the show cause notice. (ii) Whether the appellant's vehicles satisfied the statutory requirement for treatment as a tour operator service provider.

Issue (i): Whether service tax demand could be confirmed on a ground different from the one stated in the show cause notice.

Analysis: The notice proposed demand on the footing of Rent-a-cab service, while the adjudicating authority sustained the demand as tour operator service. The confirmation of demand on a basis not put to notice was beyond the scope of the proceedings and could not be sustained.

Conclusion: The demand was not sustainable on this ground and the finding was against the Revenue.

Issue (ii): Whether the appellant's vehicles satisfied the statutory requirement for treatment as a tour operator service provider.

Analysis: A person is taxable as a tour operator only if engaged in operating tours in a tourist vehicle. A tourist vehicle must conform to the statutory requirements under the Motor Vehicles law and the prescribed rules. The appellant held contract carriage permits and the vehicles did not satisfy the requirements of a tourist vehicle. The statutory condition for levy was therefore not met.

Conclusion: The appellant was not liable to service tax as a tour operator and the finding was in favour of the assessee.

Final Conclusion: The demand of service tax was set aside and the appellant obtained consequential relief according to law.

Ratio Decidendi: A service tax demand must remain within the scope of the show cause notice, and liability as a tour operator arises only where the vehicle used satisfies the statutory definition of a tourist vehicle.

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