Tour operator service tax applies only to vehicles proven to be tourist vehicles under motor vehicle law.

Service tax under the tour operator category applies only where the vehicle used is established as a tourist vehicle under the Motor Vehicles Act and the relevant rules, together with the required permit or classification. Mere use of buses for employee transport does not satisfy that statutory description. On the facts, no evidence showed that the vehicles were covered as tourist vehicles, so the demand could not be sustained. The order dropping the service tax demand was therefore upheld and the Revenue's challenge failed.

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Issues: Whether the vehicles used by the respondent qualified as tourist vehicles so as to attract service tax under the category of tour operator.

Analysis: Liability under the tour operator category depends on the use of a tourist vehicle within the meaning of the Motor Vehicles Act and the applicable rules. The decisive requirement is not a tourist permit as such, but proof that the vehicle is a tourist vehicle and is covered by a permit under the motor vehicle law. On the facts, no evidence was produced to show that the buses used for employee transport were covered as tourist vehicles under the relevant rule. In the absence of such permit and classification, the vehicles could not be treated as tourist vehicles for service tax purposes.

Conclusion: The vehicles were not established to be tourist vehicles, and the demand of service tax under the tour operator category was not sustainable. The Revenue's challenge failed.

Final Conclusion: The appeal was rejected and the order dropping the service tax demand was sustained.

Ratio Decidendi: For service tax under the tour operator category, the essential requirement is use of a tourist vehicle covered by the motor vehicle law, and in the absence of proof that the vehicle satisfies that statutory description, tax cannot be levied merely because the vehicle is used for transport of passengers.

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