Transport services not amounting to tour operator service led to setting aside service tax demand and penalties.

The assessee was treated as not liable to service tax as a tour operator because it had only provided transport and not tour operator service. The tribunal applied its decision in the assessee's own case for a subsequent period, holding that the point was no longer res integra on the same facts. On that basis, the demand of service tax and the consequential penalties under Sections 76, 77 and 78 of the Finance Act, 1994 were held unsustainable, and the appeal was allowed.

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Issues: Whether the appellants were liable to service tax as providers of tour operator services for the relevant period, along with consequential penalties under Sections 76, 77 and 78 of the Finance Act, 1994.

Analysis: The issue had already been decided in the assessee's own case for a subsequent period, where it was held that the assessee had only provided transport and had not rendered tour operator service liable to tax. That decision was treated as squarely applicable to the present facts, and the issue was therefore not regarded as res integra.

Conclusion: The demand of service tax and the consequential penalties were not sustainable, and the appeal was allowed.

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