Vehicle-hiring treated as rent-a-cab service, but extended limitation fails absent suppression or mala fide intent.

Vehicle-hiring services that, in substance, amount to providing transport by cab for consideration are taxable under rent-a-cab service, following the distinction drawn from prior Gujarat High Court reasoning. The service was therefore treated as falling within the taxable net. On limitation, the extended period could not be invoked because no deliberate suppression of facts or mala fide intention was found, and the service had only recently been brought into the tax net amid ambiguity. The taxability finding was maintained, but the extended limitation demand failed, and the matter was remanded for fresh decision in light of those findings.

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Issues: (i) whether hiring of vehicles was taxable under rent-a-cab service; (ii) whether the extended period of limitation could be invoked.

Issue (i): whether hiring of vehicles was taxable under rent-a-cab service

Analysis: The hiring arrangement was examined in the light of the earlier Gujarat High Court ruling, which treated the distinction between hiring and renting as insufficient to exclude such vehicle services from the taxable net where the service in substance amounted to providing transport by cab for consideration. The taxable entry was applied to the service actually provided by the appellant.

Conclusion: The service rendered by the appellant was held to be taxable under rent-a-cab service.

Issue (ii): whether the extended period of limitation could be invoked

Analysis: The question of extended limitation turned on whether there was deliberate suppression of facts or mala fide conduct. On the record, no such deliberate suppression or mala fide intention was found, and the service was also noted to be one that had only recently been brought within the tax net, with ambiguity prevailing on the issue.

Conclusion: The extended period of limitation was held to be unsustainable.

Final Conclusion: The taxability finding was maintained, but the demand could not be sustained on limitation for the extended period, so the matter was sent back for decision afresh in light of the findings.

Ratio Decidendi: Vehicle-hiring services falling in substance within rent-a-cab service are taxable, but the extended period cannot be invoked without deliberate suppression of facts or mala fide intention.

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